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- Title
Wage Changes: The Frequency of Wage Settlements, The Variability of Contract Length and "Locked-in" Wage Adjustments.
- Authors
Smith, Philip M.; Wilton, David A.
- Abstract
This new "institutional" approach to wage determination models represents a major improvement over other British studies. However, the institutional assumptions required for the A-P specification, while approximately correct for the United Kingdom, are not necessarily accurate in their description of the wage bargaining processes of other countries. In this paper we examine whether the critical assumptions underlying the A-P specification are appropriate in the Canadian institutional setting. Finding that they are not, we propose and estimate a generalization of the A-P model that is suitable for the Canadian economy. As found by A-P, Phillips Curve estimates are very sensitive to the nature of the institutional assumptions imposed concerning the wage bargaining process.
- Subjects
ECONOMIC forecasting; WAGES &; labor productivity; COLLECTIVE bargaining; WAGE bargaining; DEMAND function; ECONOMIC demand; PHILLIPS curve; LORENZ curve; RATIONAL expectations (Economic theory)
- Publication
Economica, 1978, Vol 45, Issue 179, p305
- ISSN
0013-0427
- Publication type
Article
- DOI
10.2307/2553075