Abstract

http://ssrn.com/abstract=2012214
 
 

References (14)



 
 

Citations (2)



 
 

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Public or Private Sector Wage Leadership? An International Perspective


Ana Lamo


European Central Bank (ECB)

Javier Gil Pérez


University Institute General Gutiérrez Mellado

Ludger Schuknecht


European Central Bank (ECB)

March 2012

The Scandinavian Journal of Economics, Vol. 114, Issue 1, pp. 228-244, 2012

Abstract:     
Whether a government acts as a wage leader, placing pressure on private‐sector wages (more open to competition), or whether it plays a passive role and merely follows wage negotiations in the private sector, there are important implications for macroeconomic development, particularly in small open economies and/or countries that are members of a monetary union, such as those of the European Monetary Union. With the notable exception of the case of Sweden, opinion on this issue is still divided. In this paper, we look at public‐ and private‐sector wage interactions from an international perspective (18 OECD countries). We focus on the causal two‐way relationship between public and private wage setting, confirming that the private sector, on the whole, appears to have a stronger influence on the public sector, rather than vice versa. However, we also find evidence of feedback effects from public wage setting, which affect private‐sector wages in a number of countries. When the private sector takes the lead on wages, there are few feedback effects from the public sector, while public wage leadership is typically accompanied by private‐sector feedback effects.

Number of Pages in PDF File: 17

Keywords: Government wages, private‐sector wages, wage leadership, causality

JEL Classification: C32, J30, J51, J52, E62, E63, H50

Accepted Paper Series





Date posted: February 28, 2012  

Suggested Citation

Lamo, Ana and Pérez, Javier Gil and Schuknecht, Ludger, Public or Private Sector Wage Leadership? An International Perspective (March 2012). The Scandinavian Journal of Economics, Vol. 114, Issue 1, pp. 228-244, 2012. Available at SSRN: http://ssrn.com/abstract=2012214 or http://dx.doi.org/10.1111/j.1467-9442.2011.01665.x

Contact Information

Ana Lamo (Contact Author)
European Central Bank (ECB) ( email )
Kaiserstrasse 29
Frankfurt am Main, D-60311
Germany
Javier Gil Pérez
University Institute General Gutiérrez Mellado ( email )
Madrid
Spain
Ludger Schuknecht
European Central Bank (ECB) ( email )
Kaiserstrasse 29
Frankfurt am Main, D-60311
Germany
+49 69 1344 6494 (Phone)
+49 69 1344 7809 (Fax)
Feedback to SSRN


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