@article{c57b2aace04d4b668b02672511d5ed05,
title = "Is there a wage curve with regional real wages? An analysis for the US and Poland",
abstract = "This paper reassesses the wage curve applying regional price deflators, whereas in the literature only uniform national price levels are generally used in wage curve regressions. Existing estimates for the unemployment elasticities vary across countries but lie mostly in the neighborhood of −0.1. Using the data for the 49 US states over the 2008–2015 period and 16 Polish NUTS2 regions over the 2000–2015 period, we test the impact of regional prices on the wage curve employing a variety of approaches. We confirm the existence of wage curves for both countries. Following the theory of monopsonistic competition, this inverse relationship stems from the costs faced by both firms and workers. However, the elasticity of local unemployment and spatial spillovers decreases significantly if regional price deflators are applied. This is due to the fact that there exists a negative relationship between regional prices and unemployment.",
keywords = "Regional labor markets, Regional price deflators, Spatial spillovers, Wage curve",
author = "Bartlomiej Rokicki and Uwe Blien and Hewings, {Geoffrey J.D.} and {thi Hong Van}, Phan",
note = "B. Rokicki gratefully acknowledges financial support from the Polish National Science Centre under the grant UMO-2016/23/B/HS4/02370 . The authors gratefully acknowledge helpful comments received from the editor and two anonymous referees of this journal. We would also like to thank Ludwig von Auer (Trier University), Bernd Fitzenberger (Friedrich-Alexander-Universit?t Erlangen-N?rnberg), Georg Hirte (Technical University of Dresden), Mark Partridge (Ohio State University), Jacques Poot (University of Waikato), Raul Ramos (University of Barcelona), Karl Taylor (University of Sheffield) and Katja Wolf (IAB) for their comments and suggestions. We are also grateful for the feedback we received from participants at the following meetings: Conference of the British and Irish Section of the ERSA, Cambridge 2019; Workshop on the Wage Curve, Schwerin 2019. B. Rokicki gratefully acknowledges financial support from the Polish National Science Centre under the grant UMO-2016/23/B/HS4/02370.",
year = "2021",
month = sep,
doi = "10.1016/j.econmod.2021.105582",
language = "English (US)",
volume = "102",
journal = "Economic Modelling",
issn = "0264-9993",
publisher = "Elsevier B.V.",
}