The productivity-wage and productivity-employment nexus: a panel data analysis of Indian manufacturing

This article investigates the long-run relationship between labour productivity and employment, and between labour productivity and real wages in the case of the Indian manufacturing sector. The panel data set consists of 17 two-digit manufacturing industries for the period 1973–1974 to 1999–2001. We find that productivity-wages and productivity-employment are panel cointegrated for all industries. We find that both employment and real wages exert a positive effect on labour productivity. We argue that flexible labour market has a significant influence on manufacturing productivity, employment and real wages in the case of Indian manufacturing.     

Trade Competitiveness and Employment: Job Creation or Job Destruction

This paper empirically examines the impact of fluctuations in international trade competitiveness on employment in the UK manufacturing sector over the period 1999–2010. We find statistically significant but economically small effects of a shock to international trade competitiveness on the level of employment. Our results show that the adjustment process in employment mainly works through job creation. We also find that compared to large firms, small firms contribute more toward job creation than job destruction. Our results that changes in GDP growth rate and average wages are significantly related to employment suggest that the UK labour market significantly responds to market forces. Finally, we find that the effect of changes in the real exchange rate on both job creation and job destruction differs between exporting and non-exporting firms.     

Estimation of the specification error in the expectations theory of the term structure

This paper tackles the issue of the procyclicality of the real wage. We present a dynamic relationship between real wages and employment consistent with the long-run stationary equilibrium using a cointegrated VAR model. We find that wages are anticyclical and that a negative relationship between real wages and employment is necessary to achieve an economically identifiable stationary long run solution. The contentiousness of the topic does not appear so important once we recall some measurement issues and economic features of the Italian labour market.     

Long-run homogeneity of labour demand. Panel evidence from OECD countries

This study makes an attempt to examine the long-run relationship between the key labour market parameters of employment, aggregate output, real product wages and labour-augmenting technical progress for a sample of 21?OECD countries covering the period from 1970 to 2000. A new panel error correction technique is applied, which allows one to constrain the long-run coefficients to be identical across the countries while letting the short-run coefficients which govern the dynamics and the error variances differ freely, respectively. Thus, this estimation approach assumes that institutional and cultural differences, albeit causing short-term deviations of labour demand behaviour across countries, leave the long-run structure of the labour markets unaffected. That is to say, the long-run equilibrium relationship between the key labour market variables is taken to be similar across the OECD economies. The empirical analysis shows that the long-run relationship between the key labour market parameters is equal across the OECD countries. However, adjustment speed of actual employment to the equilibrium is much higher in countries with flexible labour markets, such as the USA and UK, than in countries with rigid labour markets, such as Germany and Austria.     

The Effect of Changes in Real Exchange Rates on Employment: Evidence from Manufacturing Industries in China, 1980–2002

This paper analyzes the effect of changes in real exchange rate on manufacturing employment. Our theoretical model predicts the positive effect of depreciation of real exchange rate on employment through a firm’s expectation on changes in real exchange rate and the interaction between real exchange rate and a firm’s import and domestic input. Using China’s manufacturing data during the 1980–2003 period, we find that depreciation of real exchange rate promotes employment growth in manufacturing industries, while change in real exchange rate is not a significant factor in promoting wage growth. We also find that an increase in export share offsets partially the effects of real exchange rate on employment and real wages. Translated from Journal of World Economy, 2005, (4): (in Chinese)     

Cointegration Tests of the Profit-maximising Equilibrium in Greek Manufacturing: 1958–91

This paper applies the recently developed cointegration techniques to test for a long-run equilibrium among real wages and the average productivity of labour as implied by profit maximisation in the Greek manufacturing sector. We find evidence for a profit-maximising equilibrium and for adjustment towards this long-run equilibrium through nominal wages and labour productivity. We have also provided an estimate of the elasticity of substitution of 0.23 which is consistent with that of other studies using alternative approaches.     

The Impact of International Trade and Protection on Australian Manufacturing Employment

The labour market consequences of trade and protection have only recently come under the scrutiny of labour economists. This paper seeks to accomplish two things - to survey the recent research and to provide estimates of the effect that reductions in effective rates of assistance afforded to Australia's manufacturing industries have had on employment. Recent labour market developments reveal a downward trend in manufacturing employment levels. The declines appear to have been associated with lower levels of assistance. However, the estimates of the effect of lower levels of protection are generally small - about a one per cent reduction in employment for each ten per cent reduction in the effective rate of industry assistance. In addition, the manufacturing employment developments appear to be only weakly linked to real wage resistance. Overall, an overriding impression from the find ings presented in this paper is the strength of the structural adjustments ongoing in Australia     

全球制造业工资停滞之谜*——来自进口中间产品质量视角的经验证据

本文从快速增长的中间产品贸易及其质量视角研究了全球制造业工资停滞现象。首先，基于DS垄断竞争框架和Koch & Smolka(2019)的研究，本文重新构建开放条件下的工资决定模型，发现进口中间产品质量影响各国劳动工资。其次，借鉴Feenstra & Romalis(2014)的研究，本文构建全新的测度产品—行业—国家层面进口中间产品质量GEKS 指数法，估算1995—2011年37个国家从248个出口市场进口的制造业四位码中间产品质量指数，发现全球制造业进口中间产品质量上升趋势明显但分化严重，中等和低等收入国家质量指数持续上升，高等收入国家质量指数持续下降。最后，本文从跨国—行业层面定量识别进口中间产品质量对进口国制造业工资的具体影响，发现：(1)进口中间产品质量对全球制造业的劳动工资有显著负向影响，对中等收入国家、中级技术密集型行业、高技能劳动者以及进口矿物类中间产品制造业的工资降低效应最大；(2)进口中间产品质量通过“就业破坏效应”和“研发激励效应”两种机制造成全球制造业工资下降；(3)进口中间产品质量变化造成制造业工资下降是全球化中的市场性经济规律和暂时性“全球冲击波”。上述发现解释了全球制造业工资停滞之谜，并启示各国须尊重全球化的市场规律，加强国际合作，共同应对冲击，提高民众福祉，携手共建人类命运共同体。     

The Beveridge curve and labour market dynamics in Turkey

This article investigates the dynamics of unemployment and vacancy rates in Turkey during the period 1951 to 2008 by means of a Beveridge Curve (BC). The time-series analysis of unemployment and vacancies as well as two other relevant labour market variables, real wages and real labour productivity, strongly suggests inefficiency in the Turkish labour market. A stable long-run relationship between unemployment rate and vacancy rate is found for Turkey, that is, the existence of a negatively sloped BC is verified. The estimated Turkish BC reflects the structural problems and lack of flexibility in the labour market. The modified BC with real wages and labour productivity reveals that labour productivity has no significant effect on unemployment rate whereas wages have positive and significant effects on the same variable.     

汇率冲击与劳动力市场调整——中国行业数据的经验研究

文章主要分析在汇率冲击下,中国可贸易行业1998—2009年劳动力市场的调整过程。文章利用实际有效汇率指标和动态面板估计方法分析影响劳动力市场调整的不同渠道。结果表明,汇率贬值通过出口渠道增加就业和降低工资,通过进口渠道降低就业和提高工资,通过效率渠道促进就业和降低工资。高贸易依存度行业的就业汇率弹性大于低贸易依存度行业,低加成比例行业的就业汇率弹性大于高加成比例行业,劳动力技术结构是影响就业汇率弹性的重要因素。     

Endogenous Sunk Costs, Flexible Manufacturing and the Productivity Effects of International Trade

The paper addresses the productivity effects of international trade in the presence of flexible manufacturing and endogenous sunk costs (cost-reducing R&D). It shows that international trade raises R&D expenditures, but this will not necessarily boost productivity because of possibly counteracting market structure effects. The analysis is conducted in general equilibrium so that implications for real wages and welfare can also be addressed. Both can fall when trade leads to excessive R&D investment.     

人民币汇率与股价动态相关性的研究——基于次贷危机前后的比较分析

本文基于2005年8月至2010年6月的月度数据,利用协整检验和向量误差修正模型研究了次贷危机发生前后人民币名义有效汇率与股票价格之间的联动关系。实证结果表明,次贷危机发生前中国股市与汇率之间存在正向的长期均衡关系,且两者之间在长期互为因果关系;在次贷危机发生后两者之间则是反向的长期均衡关系,股价波动在长期内是人民币名义有效汇率变动的单向Granger原因。最后本文基于人民币名义有效汇率的计算方法及其影响因素,利用资产组合平衡模型、国际贸易等相关理论对实证结果进行了分析。     

人民币升值对我国制造业的就业影响

国际金融危机背景下人民币不断升值以来,我国的就业形势一直比较严峻。人民币升值对制造业就业的影响,主要体现在总需求效应、资本替代劳动效应、国际投资效应以及消费效应等方面。本文运用协整关系检验、格兰杰因果关系检验和误差修正模型等研究方法对人民币升值影响制造业就业量进行了实证分析,结果表明,人民币汇率与制造业就业量之间存在长期均衡关系,人民币在合理的范围内适度升值有利于该就业量的提高。     

The London Business School econometric model of the UK

This paper describes the London Business School econometric model — the first fully computerized model of the UK — which has been used for regular public forecasting since 1966. The model, estimated on quarterly data, is organized around the income expenditure accounts with a fully integrated flow of funds sector which ensures consistency between portfolio decisions and income, savings and investment decisions. Aggregate demand is built up from its individual components so that demand influences are important for the short- and medium-term behaviour of the model. But there are important supply-side effects which work through the real exchange rate and real wages. Monetary conditions have a powerfull effect on the model through the exchange rate, personal sector wealth and interest rates. Wages and employment are determined in a labour market in which employment decisions depend on the level of demand and real wages while real wages depend on the level of unemployment, real benefits and direct and indirect taxes as well as underlying trends in productivity. Asset prices move in any period to clear both the spot and the future market in assets so that current asset prices in the equity, gilt-edged and foreign exchange markets reflect all current information about the expected state of the economy. In contrast, goods prices adjust sluggishly. The combination of continuously clearing asset markets and sluggish wages and prices gives the model many of the theoretical characteristics associated with the open-economy models of Dornbusch and Buiter and Miller.     

Import competition,employment and wage in US manufacturing: new evidence from multivariate panel cointegration analysis

This paper examines whether employment and wages in the US manufacturing sector exhibit any long-run relationship with import competition. The results based on a multivariate panel cointegration analysis of observations on 12 two-digit SIC manufacturing industries over the period from the third quarter of 1982 to the fourth quarter of 1992 indicate that US manufacturing employment does not bear a long-run relationship with import competition but manufacturing wage does. While the long-run correlation between import price and manufacturing wage is found to be sector sensitive panel estimation reveals a highly significant negative correlation between import price and manufacturing wage.     

Price and quantity adjustments in the Austrian labour market

Austria is among the very few countries in the European Union which have managed to maintain comparatively low unemployment rates and high employment rates. This study looks at the price and quantity adjustment mechanisms in the Austrian labour market which may have contributed to this favourable outcome. After reviewing briefly the basic theoretical reasoning an empirical investigation is began into gross flow dynamics in the labour market and the cyclical volatility of employment and unemployment in Austria. In international comparison Austrian unemployment is very stable over the business cycle. This is due mainly to the high sensitivity of the labour force on cyclical conditions and, partly, also on the relatively weak responsiveness of employment to cyclical fluctuations in output, the latter being possibly attributable to the high degree of real wage flexibility in Austria. The study proceeds to show that the long-run elasticity of wages with respect to unemployment is indeed quite high in Austria. However, evidence was also found for outsider effects in the Austrian wage setting process. Relative wage structures, on the other hand, appear to be rather rigid.     

Asymmetric J-curve: evidence from industry trade between U.S. and U.K.

ABSTRACT

Previous research that assessed the impact of exchange rate changes on the trade balance between the U.S. and U.K. assumed the effects are symmetric. In this paper, we add to the literature on the asymmetric J-curve phenomenon by considering the trade balance of 68 two-digit industries that trade between the two countries. We find short-run asymmetric effects of the real dollar-pound rate in almost all industries. However, short-run asymmetric effects were translated into significant long-run asymmetric effects in 25 industries. Indeed, the asymmetric J-curve hypothesis was supported in 18 industries.     

Globalization and labor market outcomes: Wage bargaining, search frictions, and firm heterogeneity

We introduce search unemployment into Melitz's trade model. Firms' monopoly power on product markets leads to strategic wage bargaining. Solving for the symmetric equilibrium we show that the selection effect of trade influences labor market outcomes. Trade liberalization lowers unemployment and raises real wages as long as it improves average productivity. We show that this condition is likely to be met by a reduction in variable trade costs or by entry of new trading countries. Calibrating the model shows that the long-run impact of trade openness on the rate of unemployment is negative and quantitatively significant.     

RISING WAGES: HAS CHINA LOST ITS GLOBAL LABOR ADVANTAGE?

We document dramatic rising wages in China for the period 1978–2007 based on multiple sources of aggregate statistics. Although real wages increased seven‐fold during the period, growth was uneven across ownership types, industries and regions. Over the past decade, the wages of state‐owned enterprises have increased rapidly and wage disparities between skill‐intensive and labour‐intensive industries have widened. Comparisons of international data show that China's manufacturing wage has already converged to that of Asian emerging markets, but China still enjoys enormous labour cost advantages over its neighbouring developed economies. Our analysis suggests that China's wage growth will stabilize to a moderate pace in the near future.     

A tale of industrial stagnation from Africa

Many African economies have experienced rather dismal industrial development since the 1980s. The consensus is that African firms lack competitiveness in a world with increasing trade openness. What determines competitiveness? A well‐known explanation is that resource endowments in Africa favour land not labour, which results in high wages, especially in comparison with ‘labour abundant’ Asian economies. This paper examines the validity of this view on the basis of the case of Sudan. We demonstrate that the lack of competitiveness of manufacturing industries is not caused by high wages. Assuming a direct relationship between labour productivity and international competitiveness, we argue that acute capacity underutilisation, caused by supply‐side constraints, lowers manufacturing productivity, which in turn negatively influences competitiveness.