Evolving wage cyclicality in Latin America
Julian Messina () and
Luca Gambetti ()
No 6978, Policy Research Working Paper Series from The World Bank
A vector autoregression model with time-varying coefficients is used to examine the evolution of wage cyclicality in four Latin American economies: Brazil, Chile, Colombia and Mexico, during the period 1980-2010. Wages are highly pro-cyclical in all countries up to the mid-1990s except in Chile. Wage cyclicality declines thereafter, especially in Brazil and Colombia. This decline in wage cyclicality is in accordance with declining real-wage flexibility in a low-inflation environment. Controlling for compositional effects caused by changes in labor force participation along the business cycle does not alter these results.
Keywords: Labor Policies; Environmental Economics&Policies; Labor Markets; Youth and Governance; Economic Theory&Research (search for similar items in EconPapers)
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Journal Article: Evolving Wage Cyclicality in Latin America (2018)
Working Paper: Evolving Wage Cyclicality in Latin America (2017)
Working Paper: Evolving Wage Cyclicality in Latin America (2016)
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Persistent link: https://EconPapers.repec.org/RePEc:wbk:wbrwps:6978
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