Group Wage Curves

W.E. Upjohn Institute Working Paper No. 00-63PC

49 Pages Posted: 21 Nov 2001

See all articles by Timothy Bartik

Timothy Bartik

W.E. Upjohn Institute for Employment Research

Date Written: September 2000

Abstract

Using panel data on U.S. MSAs, this paper estimates how a typical MSA's wages of different demographic groups, and prices, are affected by overall MSA unemployment, the distribution of unemployment among different groups, and national prices and wages. MSA unemployment has strong effects on MSA wages and prices, but the distribution of unemployment among different groups has weak effects on wages and prices.

Using these estimates, simulations show that targeting high-unemployment groups for unemployment reductions will not reduce wage or price inflation pressures. The estimates also show that the effects of MSA unemployment on prices and disadvantaged groups' wages are greater (in absolute value) at lower unemployment rates.

As a result, simulations using these estimates suggest that national unemployment can be reduced with less inflationary pressures by targeting unemployment reductions at MSAs with high unemployment.

Keywords: group, wage, curves, Bartik, MSA, demographics, unemployment

JEL Classification: J30, R23

Suggested Citation

Bartik, Timothy, Group Wage Curves (September 2000). W.E. Upjohn Institute Working Paper No. 00-63PC, Available at SSRN: https://ssrn.com/abstract=291196 or http://dx.doi.org/10.2139/ssrn.291196

Timothy Bartik (Contact Author)

W.E. Upjohn Institute for Employment Research ( email )

300 South Westnedge Avenue
Kalamazoo, MI 49007-4686
United States

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