Downward Nominal Wage Rigidity in Services: Direct Evidence from a Firm Survey

The paper uses a new German employer survey on wage setting practices to analyze incidence and sources of nominal wage rigidity in services vs. manufacturing. We observe that wage freezes are significantly more frequent and wage cuts less frequent in services. Reasons preventing wage cuts reported by employers suggest that fear of excess worker turnover could explain this distinct behavior.

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Year of publication:	2009-01
Authors:	Radowski, Daniel ; Bonin, Holger
Institutions:	Institute for the Study of Labor (IZA)
Subject:	nominal wage rigidity \| efficiency wages \| manufacturing and services \| Germany

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Extent:	application/pdf
Series:	IZA Discussion Papers.
Type of publication:	Book / Working Paper
Language:	English
Notes:	forthcoming in: Economics Letters Number 3923 10 pages
Classification:	J31 - Wage Level and Structure; Wage Differentials by Skill, Training, Occupation, etc
Source:	RePEc - Research Papers in Economics

Persistent link: https://www.econbiz.de/10005703742