Wage Distribution and Unemployment

  • Jean-Paul Fitoussi
  • Gylfi Zoega
Part of the Central Issues in Contemporary Economic Theory and Policy book series (CICETP)


The increase in unemployment in Europe is often traced, at least partially, to the existence of some rigidities in the labor market. It is a common wisdom that wage inflexibility and labor market institutions increase the cost in terms of unemployment of adapting to shocks. In particular, minimum wage legislation is seen to have an important responsibility in countries where such legislation is binding1. By preventing relative wages and hence the wage distribution from adjusting, it leads to mounting unemployment among less qualified workers.


Minimum Wage Labor Force Participation Real Wage Unskilled Worker Relative Wage 
These keywords were added by machine and not by the authors. This process is experimental and the keywords may be updated as the learning algorithm improves.


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Copyright information

© Servizio Italiano Pubblicazioni Internazionali Srl 1996

Authors and Affiliations

  • Jean-Paul Fitoussi
    • 1
  • Gylfi Zoega
    • 1
  1. 1.OFCEParisFrance

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