Real wage growth has been less affected by the crisis than nominal wage growth, due to slowing price inflation

2016 ◽  
Keyword(s):  
Real Wage ◽  
Wage Growth ◽  
Nominal Wage ◽  
Price Inflation

scholarly journals Unemployment, wages and collective bargaining in the European Union

2004 ◽  
Vol 10 (4) ◽  
pp. 532-551 ◽  
Author(s):  
Eckhard Hein ◽  
Thorsten Schulten
Keyword(s):  
European Union ◽  
Collective Bargaining ◽  
Real Wage ◽  
Wage Growth ◽  
Social Institutions ◽  
New Keynesian ◽  
Nominal Wage ◽  
The European Union ◽  
Wage Policy ◽  
High Unemployment

This article questions the predominant view on unemployment and wages in the European Union, according to which high unemployment is primarily caused by labour market rigidities, i.e. social institutions and regulations which prevent ‘market-clearing’ real wage levels and structures. The article shows that the foundations of that view coming either from neoclassical or New Keynesian theory are not convincing, neither theoretically nor empirically. Analysis of the developments in the EU during the last four decades shows that the claimed positive relationship between real wage growth and unemployment cannot be found. On the contrary, persistently high unemployment has had strong adverse effects on nominal wage growth and on the labour income share. Weakened union bargaining power and changing collective bargaining structures have contributed to this result. This article therefore concludes that the current EU economic and employment policies aiming at further wage restraint, wage differentiation and decentralisation of collective bargaining are deeply misguided and need to be replaced by an alternative wage policy as part of a growth- and employment-oriented coordination of macroeconomic policies.

scholarly journals European Wage Dynamics and Spillovers

2019 ◽  
Vol 2019 (156) ◽  
Author(s):  
Yuanyan Sophia Zhang
Keyword(s):  
Error Correction ◽  
Labor Productivity ◽  
Euro Area ◽  
Real Wage ◽  
Wage Growth ◽  
Nominal Wage ◽  
Inflation Expectations ◽  
Wage Dynamics ◽  
Error Correction Models ◽  
Short Run

Wage rises have remained stubbornly low in advanced Europe in recent years, but, at the same time, newer EU members are experiencing rapid wage acceleration. This paper investigates the drivers of this wage divergence. Econometric analysis using error correction models suggests that wage growth responds more quickly to changes in unemployment in the newer EU members than in advanced Europe, where wages are more closely related to inflation and inflation expectations in the short run, implying greater inertia in nominal wage rises in advanced Europe. In the years after the global crisis, this inertia contributed to the build up of a real wage overhang relative to sharply slowing labor productivity, which subsequently dragged on nominal wage rises even as unemployment began to decline. Spillovers of subdued wage growth between euro area countries also weighed on wage rises in advanced Europe.

Monetary and Non-Monetary Inflation Factors

2019 ◽  
Vol 7 (4) ◽  
pp. 9-14
Author(s):  
Ольга Николайчук ◽  
Olga Nikolaychuk ◽  
Э. Зайцева ◽  
E. Zayceva
Keyword(s):  
Financial Stability ◽  
Scientific Research ◽  
Wage Growth ◽  
Macroeconomic Policy ◽  
Nominal Wage ◽  
Graphic Method ◽  
Theoretical Conclusion ◽  
Previous Issue ◽  
Analysis And Synthesis ◽  
The Relationship

In continuation of our scientific research, published in the previous issue of the journal, this article was written. In the process of research, the methods of analysis and synthesis, the graphic method were used. The results of this study prove the general theoretical conclusion about the relationship between nominal wage growth and inflation. Achieving financial stability is possible with a decrease in the rate of inflation. Based on the analysis of the scientific periodic and monographic literature, the calculations we have cited, the article concluded that the reasons for inflation in Russia are mostly non-monetary. But when choosing a macroeconomic policy, it is necessary to base on the coordination of influence on both monetary and non-monetary factors of inflation.

The Great Divergence: Real-Wage Growth of All Workers Versus Finance Workers

Challenge ◽  
2008 ◽  
Vol 51 (3) ◽  
pp. 57-79 ◽  
Author(s):  
Andrew Sum ◽  
Paulo Tobar ◽  
Joseph McLaughlin ◽  
Sheila Palma
Keyword(s):  
Real Wage ◽  
Wage Growth ◽  
Great Divergence

scholarly journals Conflicting Interests and Structural Inflation: TUrkey, 1980-1990

1993 ◽  
Vol 32 (3) ◽  
pp. 303-327 ◽  
Author(s):  
A . Erinc Yeldan
Keyword(s):  
General Equilibrium ◽  
Equilibrium Model ◽  
Computable General Equilibrium ◽  
Aggregate Demand ◽  
General Equilibrium Model ◽  
Equilibrium Analysis ◽  
Nominal Wage ◽  
Credit Expansion ◽  
Price Inflation ◽  
National Output

The paper analyses the structural causes of the recent Turkish inflationary episode. It is argued that monetary policies based on credit tightening alone are not likely to yield the desired target of price stabilisation. Instead. it is hypothesised that the underlying sources of price inflation are affected by income inequality and conflicting claims on national output; and that excessive credit expansion serves mainly to accommodate the inertial inflation thereby originated in the real sector. Given this hypothesis. the paper employs a computable general equilibrium model to investigate four distinct sources of structural inflation for the Turkish economy: (i) the profit/rent inflation based on monopolistic mark-Ups over prime costs; (ii) imported inflation due to the import-dependent structure of the domestic industry; (iii) cost-push and demand inflation due to urban wage claims; and (iv) inflation that results from the fiscal pressures of the government's budget deficits. The general equilibrium model is in the Keynesian tradition in determining the production level by aggregate demand constraints. Furthermore. it accommodates oligopolistic mark-up rules and working capital expenses for price determination. and nominal wage fixity to determine the level of employment. The general equilibrium analysis of the macro economy suggests that. over the analysed period. conflicting claims of various social classes on national output and conflicting rates of intersectoral accumulation warranted by competing producer groups have become important sources of disequilibria in the domestic economy; and that the distributional conflict among socio-economic classes had a direct impact on the formation of price movements.

Sign in / Sign up

Export Citation Format

Share Document