Abstract
This paper analyzes wage elasticities using a panel dataset of 2800 large Belgian firms over the period 1987-1994. We explore various functional forms and find that the short-run wage elasticity varies between -0.37 and -0.65, while the long-run elasticity is robustly estimated to be larger than 1 in absolute value. These results are striking for they are much higher than those reported in previous studies using macroeconomic time-series data. This suggests that labour costs are more important in determining the demand for labour than initially was believed.
Original language | English |
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Pages (from-to) | 229-241 |
Number of pages | 13 |
Journal | Economist |
Volume | 145 |
Issue number | 2 |
DOIs | |
Publication status | Published - Jan 1 1997 |
Keywords
- Jobs
- Labour demand
- Wage elasticities
- Wages
ASJC Scopus subject areas
- Economics and Econometrics