Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/153217 
Authors: 
Year of Publication: 
2007
Series/Report no.: 
ECB Working Paper No. 783
Publisher: 
European Central Bank (ECB), Frankfurt a. M.
Abstract: 
Using individual based micro-data from the German Socio Economic Panel Study (SOEP), I analyze the cyclicality of real wages for male workers within employer-employee matches over the period 1984–2004, and compare different wage measures: the standard hourly wage rate, hourly wage earnings including overtime and bonus payments, and the effective wage, which takes into account not only paid overtime, but also unpaid working hours. None of the hourly wage measures is shown to exhibit cyclicality except for the group of salaried workers with unpaid overtime. Their effective wages react strongly to changes in unemployment in a procyclical way. Despite acyclical wage rates, salaried workers without unpaid hours but with income from extra payments, such as bonuses, experienced procyclical earnings movements. Monthly earnings were also procyclical for hourly paid workers who received overtime payments. The procyclicality of earnings revealed for Germany is of comparable size with the one in the U.S..
Subjects: 
bonus payments
effective wages
firm stayers
unpaid overtime
Wage cyclicality
JEL: 
E32
J31
Document Type: 
Working Paper

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