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Co-movements between public and private wages in the EU: what factors and with what policy implications?

Co-movements between public and private wages in the EU: what factors and with what policy... This paper assesses the relationship between public and private wages in the EU, as measured by general government and manufacturing compensations, respectively. We find that the long-run relation between the two is stronger when the government is a large employer. Manufacturing compensations are better aligned with productivity and unemployment when general government compensations, to which they generally respond, are set through bargaining. Finally, manufacturing compensations react in the same way whether those in the general government sector are increased or cut, a relation that seems to hold also under fiscal consolidation provided the government is a large employer. http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png IZA Journal of European Labor Studies Springer Journals

Co-movements between public and private wages in the EU: what factors and with what policy implications?

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Publisher
Springer Journals
Copyright
Copyright © 2017 by The Author(s).
Subject
Economics; Labor Economics; Population Economics; European Integration
eISSN
2193-9012
DOI
10.1186/s40174-016-0074-1
Publisher site
See Article on Publisher Site

Abstract

This paper assesses the relationship between public and private wages in the EU, as measured by general government and manufacturing compensations, respectively. We find that the long-run relation between the two is stronger when the government is a large employer. Manufacturing compensations are better aligned with productivity and unemployment when general government compensations, to which they generally respond, are set through bargaining. Finally, manufacturing compensations react in the same way whether those in the general government sector are increased or cut, a relation that seems to hold also under fiscal consolidation provided the government is a large employer.

Journal

IZA Journal of European Labor StudiesSpringer Journals

Published: Jan 30, 2017

References