• Graduate program
  • Research
  • Summer School
  • Events
    • Summer School
      • Applied Public Policy Evaluation
      • Deep Learning
      • Economics of Blockchain and Digital Currencies
      • Economics of Climate Change
      • Foundations of Machine Learning with Applications in Python
      • From Preference to Choice: The Economic Theory of Decision-Making
      • Gender in Society
      • Machine Learning for Business
      • Sustainable Finance
      • Tuition Fees and Payment
      • Business Data Science Summer School Program
    • Events Calendar
    • Events Archive
    • Tinbergen Institute Lectures
    • 16th Tinbergen Institute Annual Conference
    • Annual Tinbergen Institute Conference
  • News
  • Alumni
  • Magazine
Home | Events Archive | The False Illusion of Wage Cyclicality
Event

The False Illusion of Wage Cyclicality

  • Location
    lounge/kitchen E Building floor E1
    Rotterdam
  • Date and time

    March 31, 2022
    12:00 - 13:00

Abstract:

Wage rigidity has become a leading hypothesis in macroeconomic models to rationalize business cycle dynamics observed in the data. However, the finding that wages of job-switchers are more cyclical than that of job-stayers has been cited as evidence of a limited role for wage rigidity. In this paper, we use a longitudinal matched employer-employee dataset for Portugal over the 1986-2019 period to revisit the issue of wage cyclicality. Taking advantage of a particular feature of the data that allows us to account for occupational mobility within and across firms, we provide evidence that the flexibility of new hire wages is similar to that of job-stayers.

(joint work with Ines Black, Duke University)