Productivity as a Determinant of Labour Wage in New Zealand's Construction Sector

Ozturk, M., Durdyev, S., Aras, O. N., & Banaitis, A. (2019). Productivity as a determinant of labour wage in New Zealand’s construction sector. Technological and Economic Development of Economy, 25(5), 900-914. DOI: 10.3846/tede.2019.10297

15 Pages Posted: 10 Oct 2019

See all articles by Mustafa Öztürk

Mustafa Öztürk

International Trade

Serdar Durdyev

Ara Institute of Canterbury

Osman Nuri Aras

Nile University of Nigeria

Audrius Banaitis

affiliation not provided to SSRN

Date Written: September 13, 2019

Abstract

The empirical relationships between labour wages, unemployment rate and the labour productivity index in New Zealand’s construction sector (for the period of 1983–2017) were investigated. The Johansen cointegration test and vector error correction mechanism were used to determine the existence of long-run relationships between the variables and the adjustment process of the short-run disequilibrium into the long-run equilibrium. The results show that the labour productivity index positively affects the labour wage, while the effect of unemployment rate is negative in the long run. That is, the more productive the labour, the more the wages earned. Related statistical tests on the residuals proved that the model and its findings are reliable.

Keywords: productivity, labour wage, New Zealand, construction, panel data analysis, unemployment

JEL Classification: E10, E24, J24

Suggested Citation

Öztürk, Mustafa and Durdyev, Serdar and Aras, Osman Nuri and Banaitis, Audrius, Productivity as a Determinant of Labour Wage in New Zealand's Construction Sector (September 13, 2019). Ozturk, M., Durdyev, S., Aras, O. N., & Banaitis, A. (2019). Productivity as a determinant of labour wage in New Zealand’s construction sector. Technological and Economic Development of Economy, 25(5), 900-914. DOI: 10.3846/tede.2019.10297. Available at SSRN: https://ssrn.com/abstract=3461235

Mustafa Öztürk

International Trade

Istanbul
Turkey

Serdar Durdyev

Ara Institute of Canterbury ( email )

City Campus
Madras street
Christchurch
New Zealand

Osman Nuri Aras (Contact Author)

Nile University of Nigeria ( email )

Abuja
Nigeria

Audrius Banaitis

affiliation not provided to SSRN

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