Wage Dynamics in Bulgaria: Co-movement and Causality

Hristina Manolova and Aleksandar Vasilev

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Abstract: Motivated by recent debates on the possible role of wages as an income policy tool, in this study we examine the dynamic inter-relationship between wages in Bulgaria, mainly in the context of its EU accession. Relative to the WDN studies on the other EU member states, the novelty in this paper is the inclusion of the minimum wage as a possible conditional determinant of the other two wages. We demonstrate that minimum wage increases do not cause changes in average wages in either the government or the private sector. Using variety of econometric tests, we also demonstrate the leadership of private sector wage over public compensation and recommend the implementation of policy measures aimed at labor productivity growth.

Keywords: private sector wages; public sector wages; minimum wages; causality (search for similar items in EconPapers)
JEL-codes: J3 J4 (search for similar items in EconPapers)
Date: 2017
New Economics Papers: this item is included in nep-tra
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Related works:
Journal Article: Wage Dynamics and Bulgaria Co-Movement and Causality (2019)
Journal Article: Wage Dynamics and Bulgaria: Co-movement and Causality (2019)
Working Paper: Wage Dynamics in Bulgaria: Co-movement and Causality (2017)
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Persistent link: https://EconPapers.repec.org/RePEc:zbw:esprep:168049

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