Victor Montuenga

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.

Intra-family distribution of paid-work time

This article analyses the intra-family distribution of paid-work time in five European countries (France, Germany, Italy, Spain and the UK). To that end, we formulate a collective model, which allows us to characterize the efficient labour supply decisions of each spouse. This two-equation model is then simultaneously estimated by using national panel data drawn from the European Community Household Panel-ECHP (1994–2001). Empirical results clearly show that, in all sample countries, the labour supply of wives is affected by own wages, household and own nonlabour incomes and the number of children, whereas evidence for husbands differs across countries.