Modelling Shifts in the Wage-Price and Unemployment-Inflation Relationships in Italy, Poland, and the UK
Bocconi University, IGIER Working Paper No. 145
27 Pages Posted: 13 Mar 1999
Date Written: February 1999
Abstract
The relationship between wages, prices, productivity, inflation, and unemployment in Italy, Poland, and the UK between the 1960's and the early 1990's is modelled as a cointegrated vector autoregression subject to regime shifts. For each of these economies there is clear evidence of a change in the underlying equilibria of this sector of the economy. Hypotheses concerning the similarity of the transition from a rigid to a flexible labour market are tested.
JEL Classification: C32, C51, E24
Suggested Citation: Suggested Citation
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