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Wage Cyclicalities and Labor Market Dynamics at the Establishment Level: Theory and Evidence

Author

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  • Merkl, Christian
  • Stüber, Heiko
Abstract
The paper analyzes the effects of different wage cyclicalities on labor market flow dynamics. We derive a model that allows for heterogeneous wage cyclicalities across firms over the business cycle and confront the theoretical results with the new AWFP dataset. Establishments with more procyclical wage movements over the business cycle have a more countercyclical hires rate. The quantitative responses are in line with the proposed model.

Suggested Citation

  • Merkl, Christian & Stüber, Heiko, 2017. "Wage Cyclicalities and Labor Market Dynamics at the Establishment Level: Theory and Evidence," VfS Annual Conference 2017 (Vienna): Alternative Structures for Money and Banking 168129, Verein für Socialpolitik / German Economic Association.
    • Handle: RePEc:zbw:vfsc17:168129
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    References listed on IDEAS

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    Citations

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    Cited by:

    1. Hammer, Luisa & Hertweck, Matthias Sebastian, 2022. "EU Enlargement and (Temporary) Migration: Effects on Labour Market Outcomes in Germany," VfS Annual Conference 2022 (Basel): Big Data in Economics 264082, Verein für Socialpolitik / German Economic Association.
    2. Christian Merkl & Heiko Stüber, 2019. "Value added, wages and labour market flows at the establishment level," Applied Economics Letters, Taylor & Francis Journals, vol. 26(2), pages 135-142, January.
    3. Bachmann, Rüdiger & Bayer, Christian & Merkl, Christian & Seth, Stefan & Stüber, Heiko & Wellschmied, Felix, 2017. "Worker Churn and Employment Growth at the Establishment Level," IZA Discussion Papers 11063, Institute of Labor Economics (IZA).
    4. Stüber Heiko & Seth Stefan, 2019. "The Public Release Data of the Administrative Wage and Labor Market Flow Panel," Journal of Economics and Statistics (Jahrbuecher fuer Nationaloekonomie und Statistik), De Gruyter, vol. 239(2), pages 333-344, April.
    5. Dengler, Thomas & Gehrke, Britta, 2021. "Short-Time Work and Precautionary Savings," IZA Discussion Papers 14329, Institute of Labor Economics (IZA).
    6. Barrela, Rodrigo & Costa, Eduardo & Portugal, Pedro, 2024. "On the Asymmetrical Sensitivity of the Distribution of Real Wages to Business Cycle Fluctuations," IZA Discussion Papers 16911, Institute of Labor Economics (IZA).
    7. Bachmann, Rüdiger & Bayer, Christian & Merkl, Christian & Seth, Stefan & Stüber, Heiko & Wellschmied, Felix, 2021. "Worker churn in the cross section and over time: New evidence from Germany," Journal of Monetary Economics, Elsevier, vol. 117(C), pages 781-797.
    8. Bachmann, Rüdiger & Bayer, Christian & Merkl, Christian & Seth, Stefan & Stüber, Heiko & Wellschmied, Felix, 2017. "Job and worker flows: New stylized facts for Germany," FAU Discussion Papers in Economics 02/2017, Friedrich-Alexander University Erlangen-Nuremberg, Institute for Economics.
    9. Matthew Knowles & Mario Lupoli, 2023. "The Nash Wage Elasticity and its Business Cycle Implications," ECONtribute Discussion Papers Series 240, University of Bonn and University of Cologne, Germany.

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    More about this item

    JEL classification:

    • E24 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Employment; Unemployment; Wages; Intergenerational Income Distribution; Aggregate Human Capital; Aggregate Labor Productivity
    • E32 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Business Fluctuations; Cycles
    • J64 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Unemployment: Models, Duration, Incidence, and Job Search

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