Wage determination in Argentina: an econometric analysis with methodology discussion
- Autores
- Galiani, Sebastian
- Año de publicación
- 2000
- Idioma
- inglés
- Tipo de recurso
- documento de conferencia
- Estado
- versión publicada
- Descripción
- Micro evidence on the relationship between wages and unemployment has been provided recently in a series of contributions by Blanchflower and Oswald (1994, 1995). They argue for the existence of a wage curve linking local wages to local unemployment. They claim the relationship to be static. They also claim that the unemployment elasticity of pay is -0.1 across-countries. They claim that this shows that countries exhibit the same degree of wage flexibility. In this paper we study wage determination in Argentina. We believe that both regional and national factors affect wage setting. Thus, we also favor the modelization at the regional level of aggregation. However, we show that a regional wage two-way fixed effects error component model does not identify the effect of aggregate variables on wages though it controls for them. Thus, the claim that the estimated unemployment elasticity of pay in this model provides a good measure of wage flexibility may be misleading. We propose a three-step estimator that may identify the whole set of parameters of interest in a wage equation. That is, we propose a statistical procedure that may consistently estimate the coefficients of both local and aggregate variables that affect wage setting. We reject the existence of a static wage curve in favor of a dynamic regional wage equation. Additionally, we tentatively favor an error correction mechanism representation instead of a Phillips curve type representation for the common time series component of the regional wages.
Departamento de Economía - Materia
-
Ciencias Económicas
local and aggregate determinants of wages; three-step procedure; Phillips curve;error correction mechanism
econometría
Argentina
salario - Nivel de accesibilidad
- acceso abierto
- Condiciones de uso
- http://creativecommons.org/licenses/by/3.0/
- Repositorio
- Institución
- Universidad Nacional de La Plata
- OAI Identificador
- oai:sedici.unlp.edu.ar:10915/3661
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Wage determination in Argentina: an econometric analysis with methodology discussionGaliani, SebastianCiencias Económicaslocal and aggregate determinants of wages; three-step procedure; Phillips curve;error correction mechanismeconometríaArgentinasalarioMicro evidence on the relationship between wages and unemployment has been provided recently in a series of contributions by Blanchflower and Oswald (1994, 1995). They argue for the existence of a wage curve linking local wages to local unemployment. They claim the relationship to be static. They also claim that the unemployment elasticity of pay is -0.1 across-countries. They claim that this shows that countries exhibit the same degree of wage flexibility. In this paper we study wage determination in Argentina. We believe that both regional and national factors affect wage setting. Thus, we also favor the modelization at the regional level of aggregation. However, we show that a regional wage two-way fixed effects error component model does not identify the effect of aggregate variables on wages though it controls for them. Thus, the claim that the estimated unemployment elasticity of pay in this model provides a good measure of wage flexibility may be misleading. We propose a three-step estimator that may identify the whole set of parameters of interest in a wage equation. That is, we propose a statistical procedure that may consistently estimate the coefficients of both local and aggregate variables that affect wage setting. We reject the existence of a static wage curve in favor of a dynamic regional wage equation. Additionally, we tentatively favor an error correction mechanism representation instead of a Phillips curve type representation for the common time series component of the regional wages.Departamento de Economía2000-06-02info:eu-repo/semantics/conferenceObjectinfo:eu-repo/semantics/publishedVersionObjeto de conferenciahttp://purl.org/coar/resource_type/c_5794info:ar-repo/semantics/documentoDeConferenciaapplication/pdfhttp://sedici.unlp.edu.ar/handle/10915/3661enginfo:eu-repo/semantics/altIdentifier/url/http://www.depeco.econo.unlp.edu.ar/siff/2000/trabajo2.pdfinfo:eu-repo/semantics/openAccesshttp://creativecommons.org/licenses/by/3.0/Creative Commons Attribution 3.0 Unported (CC BY 3.0)reponame:SEDICI (UNLP)instname:Universidad Nacional de La Platainstacron:UNLP2025-09-29T10:49:17Zoai:sedici.unlp.edu.ar:10915/3661Institucionalhttp://sedici.unlp.edu.ar/Universidad públicaNo correspondehttp://sedici.unlp.edu.ar/oai/snrdalira@sedici.unlp.edu.arArgentinaNo correspondeNo correspondeNo correspondeopendoar:13292025-09-29 10:49:17.606SEDICI (UNLP) - Universidad Nacional de La Platafalse |
dc.title.none.fl_str_mv |
Wage determination in Argentina: an econometric analysis with methodology discussion |
title |
Wage determination in Argentina: an econometric analysis with methodology discussion |
spellingShingle |
Wage determination in Argentina: an econometric analysis with methodology discussion Galiani, Sebastian Ciencias Económicas local and aggregate determinants of wages; three-step procedure; Phillips curve;error correction mechanism econometría Argentina salario |
title_short |
Wage determination in Argentina: an econometric analysis with methodology discussion |
title_full |
Wage determination in Argentina: an econometric analysis with methodology discussion |
title_fullStr |
Wage determination in Argentina: an econometric analysis with methodology discussion |
title_full_unstemmed |
Wage determination in Argentina: an econometric analysis with methodology discussion |
title_sort |
Wage determination in Argentina: an econometric analysis with methodology discussion |
dc.creator.none.fl_str_mv |
Galiani, Sebastian |
author |
Galiani, Sebastian |
author_facet |
Galiani, Sebastian |
author_role |
author |
dc.subject.none.fl_str_mv |
Ciencias Económicas local and aggregate determinants of wages; three-step procedure; Phillips curve;error correction mechanism econometría Argentina salario |
topic |
Ciencias Económicas local and aggregate determinants of wages; three-step procedure; Phillips curve;error correction mechanism econometría Argentina salario |
dc.description.none.fl_txt_mv |
Micro evidence on the relationship between wages and unemployment has been provided recently in a series of contributions by Blanchflower and Oswald (1994, 1995). They argue for the existence of a wage curve linking local wages to local unemployment. They claim the relationship to be static. They also claim that the unemployment elasticity of pay is -0.1 across-countries. They claim that this shows that countries exhibit the same degree of wage flexibility. In this paper we study wage determination in Argentina. We believe that both regional and national factors affect wage setting. Thus, we also favor the modelization at the regional level of aggregation. However, we show that a regional wage two-way fixed effects error component model does not identify the effect of aggregate variables on wages though it controls for them. Thus, the claim that the estimated unemployment elasticity of pay in this model provides a good measure of wage flexibility may be misleading. We propose a three-step estimator that may identify the whole set of parameters of interest in a wage equation. That is, we propose a statistical procedure that may consistently estimate the coefficients of both local and aggregate variables that affect wage setting. We reject the existence of a static wage curve in favor of a dynamic regional wage equation. Additionally, we tentatively favor an error correction mechanism representation instead of a Phillips curve type representation for the common time series component of the regional wages. Departamento de Economía |
description |
Micro evidence on the relationship between wages and unemployment has been provided recently in a series of contributions by Blanchflower and Oswald (1994, 1995). They argue for the existence of a wage curve linking local wages to local unemployment. They claim the relationship to be static. They also claim that the unemployment elasticity of pay is -0.1 across-countries. They claim that this shows that countries exhibit the same degree of wage flexibility. In this paper we study wage determination in Argentina. We believe that both regional and national factors affect wage setting. Thus, we also favor the modelization at the regional level of aggregation. However, we show that a regional wage two-way fixed effects error component model does not identify the effect of aggregate variables on wages though it controls for them. Thus, the claim that the estimated unemployment elasticity of pay in this model provides a good measure of wage flexibility may be misleading. We propose a three-step estimator that may identify the whole set of parameters of interest in a wage equation. That is, we propose a statistical procedure that may consistently estimate the coefficients of both local and aggregate variables that affect wage setting. We reject the existence of a static wage curve in favor of a dynamic regional wage equation. Additionally, we tentatively favor an error correction mechanism representation instead of a Phillips curve type representation for the common time series component of the regional wages. |
publishDate |
2000 |
dc.date.none.fl_str_mv |
2000-06-02 |
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info:eu-repo/semantics/conferenceObject info:eu-repo/semantics/publishedVersion Objeto de conferencia http://purl.org/coar/resource_type/c_5794 info:ar-repo/semantics/documentoDeConferencia |
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http://sedici.unlp.edu.ar/handle/10915/3661 |
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eng |
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eng |
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