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The spot market matters : evidence on implicit contracts from Britain
Author(s)
Date Issued
2005-02
Date Available
2008-12-11T17:09:11Z
Abstract
Based on the methodology of Beaudry and DiNardo (1991), this paper investigates the
relative importance of the spot market and implicit contracts in the determination of British real wages. Empirical work is carried out separately for males and females with individual level data taken from the New Earnings Survey Panel for the years 1976 to 2001. In contrast to previous studies that used North American data, the spot market is found to be more important than implicit contracts in determining real wages. Indeed, there is very little support
for implicit contracts in these data. Further evidence is provided through the analysis of individual wage sequences. These suggest that the downwardly rigid wage sequences implied by implicit contracts with costless worker mobility are not prevalent in Britain.
Type of Material
Working Paper
Publisher
Institute for the Study of Labor
Series
IZA Discussion Paper Series
No. 1497
Copyright (Published Version)
The Institute for the Study of Labor (IZA) 2005
Classification
E24
E32
J31
Subject – LCSH
Labor contract--Mathematical models
Personnel management--Mathematical models
Unemployment--Effect of wages on
Wages--Mathematical models
Web versions
Language
English
Status of Item
Not peer reviewed
This item is made available under a Creative Commons License
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