The Wage Curve in Poland in 1995-2005

The main aim of the paper is to check if wages have adjusted to the situation on local labour market in Poland during the last ten years. According to Blanchflower and Oswald there exists a nonlinear and downward-sloping relationship between the situation on the regional labour market and the level of pay. The analyses conducted in the paper confirm the negative and statistically significant relation between wages and unemployment, even though this relation is quite weak. More important for the regional diveristy of wages in Poland is the level of labour productivity and the employment structure. The results show also that elasticity of wages was not constant over time. In 1999-2001 when the unemployment rates in all regions were increasing the relation between wages and unemployment was very weak, which indicates that wages in Poland are downward rigid