Abstract
This article summarizes evidence for the existence of a wage curve – a downward-sloping relationship between the level of pay and the local unemployment rate – in modern micro data. At the time of writing, the curve has been found in 40 nations. Its elasticity is approximately −0.1.
This is a preview of subscription content, log in via an institution.
Buying options
Tax calculation will be finalised at checkout
Purchases are for personal use only
Learn about institutional subscriptionsBibliography
Bellmann, L., and U. Blien. 2001. Wage curve analyses of establishment data from Western Germany. Industrial and Labor Relations Review 54: 851–863.
Blanchard, O., and L.F. Katz. 1997. What we know and do not know about the natural rate of unemployment. Journal of Economic Perspectives 11(1): 51–72.
Blanchflower, D.G., and A.J. Oswald. 1994. The wage curve. Cambridge, MA: MIT Press.
Blanchflower, D.G., and A.J. Oswald. 1995. An introduction to the wage curve. Journal of Economic Perspectives 9(3): 153–167.
Blanchflower, D.G., and A.J. Oswald. 2005. The wage curve reloaded. Working Paper No. 11338. Cambridge, MA: NBER.
Card, D., and D. Hyslop. 1997. Does inflation ‘grease the wheels’ of the labor market? In Reducing inflation: Motivation and strategy, NBER Studies in Business Cycles, ed. C.D. Romer and D.H. Romer, Vol. 30. Chicago/London: University of Chicago Press.
Garcia-Mainar, I., and V. Montuenga-Gomez. 2003. The Spanish wage curve: 1994–1996. Regional Studies 37: 929–945.
Hines, J., H. Hoynes, and A.B. Krueger. 2001. Another look at whether a rising tide lifts all boats. In The roaring nineties: Can full employment be sustained? ed. A.B. Krueger and R.M. Solow. New York: Russell Sage Foundation.
Hoddinott, J. 1996. Wages and unemployment in an urban African labour market. Economic Journal 106: 1610–1626.
Janssens, S., and J. Konings. 1998. One more wage curve: The case of Belgium. Economics Letters 60: 223–227.
Kingdon, G.G., and J. Knight. 2006. How flexible are wages in response to local unemployment in South Africa? Industrial and Labor Relations Review 59: 471–495.
Nijkamp, P., and J. Poot. 2005. The last word on the wage curve? A meta-analytic assessment. Journal of Economic Surveys 19: 421–450.
Phillips, A.W. 1958. The relation between unemployment and the rate of change of money wage rates in the United Kingdom, 1861–1957. Economica 25: 283–299.
Pissarides, C.A. 2000. Equilibrium unemployment theory. 2nd ed. Cambridge, MA: MIT Press.
Sabin, L. 1999. The development of urban labour markets: China’s urban wage curve, 1980–92. Journal of Development Studies 35(3): 134–152.
Sanz-de-Galdeano, A., and J. Turunen. 2006. The euro area wage curve. Economics Letters 92: 93–98.
Sargan, J.D. 1964. Wages and prices in the United Kingdom: A study in econometric methodology. In Econometrics and quantitative economics, ed. D.F. Hendry and K.F. Wallis. New York: Basil Blackwell, 1984.
Shapiro, C., and J. Stiglitz. 1984. Equilibrium unemployment as a worker discipline device. American Economic Review 74: 433–444.
Staiger, D., J.H. Stock, and M.W. Watson. 2002. Prices, wages and the U.S. NAIRU in the 1990s. In The roaring nineties: Can full employment be sustained? ed. A. Krueger and R. Solow. New York: Russell Sage Foundation.
Acknowledgment
We thank Bruce Weinberg for helpful suggestions.
Author information
Authors and Affiliations
Editor information
Copyright information
© 2018 Macmillan Publishers Ltd.
About this entry
Cite this entry
Blanchflower, D.G., Oswald, A.J. (2018). Wage Curve. In: The New Palgrave Dictionary of Economics. Palgrave Macmillan, London. https://doi.org/10.1057/978-1-349-95189-5_2544
Download citation
DOI: https://doi.org/10.1057/978-1-349-95189-5_2544
Published:
Publisher Name: Palgrave Macmillan, London
Print ISBN: 978-1-349-95188-8
Online ISBN: 978-1-349-95189-5
eBook Packages: Economics and FinanceReference Module Humanities and Social SciencesReference Module Business, Economics and Social Sciences