Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/243138
Authors: 
Merkl, Christian
Stüber, Heiko
Year of Publication: 
2021
Series/Report no.: 
FAU Discussion Papers in Economics No. 06/2021
Abstract: 
We document substantial cross-sectional heterogeneity of German establishments' real wage cyclicality over the business cycle. While wages of the median establishment are moderately procyclical, 36 percent of establishments have countercyclical wages. We estimate a negative connection between establishments' wage cyclicality and their employment cyclicality, thereby providing a benchmark for quantitative macroeconomic models. We propose and calibrate a labor market ow model to match various empirical facts and to perform counterfactual exercises. If all establishments behaved as the most procyclical ones, labor market amplification would drop by one-third. If all followed Nash bargaining, it would drop by more than two-thirds.
Subjects: 
Wage Cyclicality
Employment Cyclicality
Labor Market Flow Model
Labor Market Dynamics
Establishments
Administrative Data
JEL: 
E32
E24
J64
Document Type: 
Working Paper

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