Melchor Fernández

Wage flexibility: evidence from five EU countries based on the wage curve

Abstract This paper examines wage flexibility in five EU countries by estimating their respective wage curves. Using information provided by a homogeneous panel data set—the ECHP—we are able to demonstrate that, contrary to the habitual finding, the wage elasticity to unemployment in fact varies across countries.

Regional Wage Flexibility: the Wage Curve in Five EU Countries

In this piece of research, we estimate wage curves for five EU member states using homogenous information provided in panel data set (the ECHP) to appraise wage flexibility. Whereas typical estimation concentrates solely on the relationship between current wages and current unemployment rate, we also consider the influence of lagged values of unemployment rates -the unemployment rate at the moment of hiring, and the minimum unemployment rate since the moment of hiring- to take into account the possibility of wages being flexible upwards, but sticky downwards. Results show that, first, wage flexibility does vary across countries and, second, that the traditional view of the wage curve as representing a spot labour market is valid only for one of the countries analysed, the UK.

Labor conditions in the Spanish hotels and restaurants industry.

The tourism and hotels and restaurants industries fall within the service sector and employ many people with different skills and capacities. As in other sectors, it is important to monitor employment and working conditions in this sector. However, there has not been any empirical systematic research into employment and wage conditions in the Spanish hotels and restaurants sector, partly because of the complexity and size of the sector. All studies that exist on salary levels in the tourism industry emphasize the fact that the hotels and restaurants sector is among the lowest paid business sectors and it employs a large proportion of women and nonqualified labor. Such characteristics generate lower pay and greater risk of gender discrimination. The aim of this article is to analyze these two negative aspects of labor market conditions in the hotels and restaurants industry in Spain and to discuss regional differences comparing tourism regions and nontourism regions. We show that low-wage incidence in the hotels and restaurants industry disappears with the tourism development of the sector, that is, it is lower in the tourism regions. Nevertheless, gender discrimination does not depend on the tourism or nontourism characterization of regions.

The Link Between Wages and Productivity in Spain

Abstract This paper examines the effect of productivity on wages for Spanish industrial sectors by developing a model that captures effects from both sector‐specific and aggregate variables. The results show that a dual behaviour can be inferred, at the sector level, in the wage‐setting mechanism. It is also found that the linkage between wages and productivity varies over time. Some explanations for the increase in wage dispersion are provided, focusing on the increasing decentralisation in wage bargaining after 1986. Finally, we cast some light on the theoretical structure underlying the labour market.

The economic impact of international students in a regional economy from a tourism perspective

This paper assesses the economic impact of international students in a regional economy (Galicia) from the viewpoint of the tourism industry. The current extent of international student mobility and its potential future development make it an appropriate topic for analysis in terms of its local and regional economic impacts, first and foremost at the academic and political levels. A methodology to facilitate the estimation of both the direct effects on the education sector and the possible ‘externalities’ on the tourism industry will enable economic evaluation of financial efforts to attract international students. Without considering the potential increase of other visitors, the results indicate that international students have less economic impact than that associated with inbound tourism and, in the case of exchange students (as a constituent group of international students), the economic contribution could even be negative for a local economy.

The impact of health on wages: Evidence from Europe before and during the Great Recession

This paper adds to the empirical literature of health as a potential endogenous explanatory variable in wage equations by addressing problems such as unobserved heterogeneity, sample selection and measurement error (in the health variable) in one comprehensive framework. Moreover, by using European individual-level panel data from before and during the Great Recession (GR) — which started in Europe in 2008 — we gain insights into whether and how the current crisis has altered the relationship between health and wages. Our results provide empirical evidence of measurement error in the self-reported health variable when estimating its impact on wages for men, and of selectivity bias in wages for both men and women. We also show that in the period prior to the GR, working-age men (20-64 years old) who are in relatively better health (measured by a one-unit increase in a health index) have, on average, a 9 percent higher hourly wage rate. This effect is concentrated (and largest) among older workers (50-64 years old). Instead, during the GR the positive impact of health on wages disappears. One possible explanation for these findings is that presenteeism (i.e. attending work even though being sick) — which has become more common during the GR — may have reduced the impact of (poor) health on wages. With regard to working-age women (20-59 years old), we do not find evidence of an effect of health on wages, both before and during the GR.