We found a match
Your institution may have access to this item. Find your institution then sign in to continue.
- Title
INFLATION AND WAGE RIGIDITY/FLEXIBILITY IN THE SHORT RUN.
- Authors
Park, Seonyoung; Shin, Donggyun
- Abstract
A recent literature uses accurate wage data from payroll records and provides compelling evidence against the conventional belief that nominal wages are downward sticky. This paper provides a unique contribution to this literature by conducting a formal analysis of the role of inflation in cyclical wage rigidity/flexibility. Analysis of payroll‐based wage data from the Korean labor market for the period 1971–2014 finds that the degree of downward nominal wage flexibility is countercyclical, and the countercyclicality becomes stronger during a deflationary, relative to inflationary, recession. This serves as a counter‐example to the conventional theory of cyclical wage rigidity.
- Subjects
PRICE inflation; WAGES; SHORT run (Economics); PAYROLLS; LABOR market
- Publication
Economic Inquiry, 2019, Vol 57, Issue 3, p1675
- ISSN
0095-2583
- Publication type
Article
- DOI
10.1111/ecin.12786