Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/19247 
Year of Publication: 
2004
Series/Report no.: 
HWWA Discussion Paper No. 275
Publisher: 
Hamburg Institute of International Economics (HWWA), Hamburg
Abstract: 
We address the effects of wages on employment growth on the basis of a theoretical model from which cost and demand effects can be derived. In the empirical analysis we take a highly disaggregated perspective and apply a newly developed shift-share regression technique on an exhaustive and very accurate data set for West Germany. The regression shows that the impact of regional wages on employment growth is significantly negative. There is some variation of this effect across sectors, but in no case we find support for the claim that an exogenous wage increase leads to higher employment growth.
Subjects: 
Employment Growth
Shift-Share-Analysis
Regional Wages
Purchasing Power Argument
JEL: 
R11
J23
E24
Document Type: 
Working Paper

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