Do wages reflect labor productivity? The case of Belgian regions

Jozef Konings, Luca Marcolin

Research output: Contribution to journalArticle

4 Citations (Scopus)

Abstract

We simultaneously estimate a wage and a labor productivity equation where we include regional dummies as explanatory variables. We find that the wage-productivity gap reached 11% for Brussels and 4.2% for Wallonia in the years 2005-2012. This was driven by the negative performance in labor productivity of firms in these regions relative to Flanders, which more than compensated for the advantage in average salary cost they enjoyed. These results are coherent with the existence at the regional level of institutional barriers to the firm-level adjustment of wages to labor productivity. JEL codes: J24; J31; J5; R23

Original languageEnglish
Article number11
JournalIZA Journal of European Labor Studies
Volume3
Issue number1
DOIs
Publication statusPublished - Dec 1 2014
Externally publishedYes

Fingerprint

Labour productivity
Wages
Productivity gap
Costs
Salary
Flanders

ASJC Scopus subject areas

  • Economics and Econometrics
  • Industrial relations
  • Organizational Behavior and Human Resource Management

Cite this

Do wages reflect labor productivity? The case of Belgian regions. / Konings, Jozef; Marcolin, Luca.

In: IZA Journal of European Labor Studies, Vol. 3, No. 1, 11, 01.12.2014.

Research output: Contribution to journalArticle

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