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Title:Wages and Employment Growth : Disaggregated Evidence for West Germany PDF Logo
Authors:Suedekum, Jens
Blien, Uwe
Issue Date:2004
Series/Report no.:IZA Discussion paper series 1128
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:J23
E24
R11
Document Type:Working Paper
Appears in Collections:IZA Discussion Papers, Forschungsinstitut zur Zukunft der Arbeit (IZA)

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