Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/82877 
Year of Publication: 
1999
Series/Report no.: 
Working Paper No. 1999:12
Publisher: 
Uppsala University, Department of Economics, Uppsala
Abstract: 
This study reports the results from a repeat survey among managers in Swedish manufacturing, designed to explore how a severe and prolonged macroeconomic shock affects wage rigidity and unemployment. Our second survey was conducted in 1998, when the unemployment rate was much higher, and the inflation rate much lower, than when we conducted the first survey in 1991. We find no evidence that the increase in unemployment has softened the mechanisms generating wage rigidity. On the contrary, we conclude that – because of severe downward nominal wage rigidity – real wages have become more rigid during Sweden’s move to a low-inflation environment. We also report a range of new evidence on underbidding, efficiency wage mechanisms, job security legislation, workers’ wage norms, and to what extent the long-term unemployed are subject to statistical discrimination.
Subjects: 
Unemployment
wage rigidity
repeat survey
recession
JEL: 
E24
J41
J63
Persistent Identifier of the first edition: 
Document Type: 
Working Paper

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