March 26, 2009
Why do macro wage elasticities diverge? A meta analysis
This study analyses macro elasticities of the gross yearly wage per employee.
From some 90 books, articles and working papers, more than 1000 elasticities have been extracted. The results indicate that the dynamic specification of the wage equation, the choice of explanatory variables and restrictions on estimated coefficients all have their impact on estimated elasticities. From the results, we generate benchmark values for each type of elasticity that may be useful to calibrate policy simulation models.
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Authors
Kees Folmer