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Wages, Implicit Contracts and the Business Cycle: Evidence from Canadian Micro Data

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Author Info
McDonald, J.T.
Worswick, C.

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Abstract

Evidence of macroeconomic conditions impacting the earnings of men in Canada in a manner consistent with an implicit contracting framework is found using data from eleven cross-sectional surveys spanning the years 1981-1992. The estimates are similar to those found by Beaudry and DiNardo (1991) using U.S. data. Their analysis is extended to incestigate whether the effects of macroeconomic conditions differ by age. Evidence is found that the wages of young men and men near retirement are most sensitive to changes in the macroeconomic conditions over their job tenure.

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Publisher Info
Paper provided by The University of Melbourne in its series Department of Economics - Working Papers Series with number 588.

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Length: 14 pages
Date of creation: 1997
Date of revision:
Handle: RePEc:mlb:wpaper:588

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Postal: Department of Economics, The University of Melbourne, 5th Floor, Economics and Commerce Building, Victoria, 3010, Australia
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Web page: http://www.economics.unimelb.edu.au
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Related research
Keywords: WAGES ; BUSINESS CYCLES;

Other versions of this item:

Find related papers by JEL classification:
J19 - Labor and Demographic Economics - - Demographic Economics - - - Other
J11 - Labor and Demographic Economics - - Demographic Economics - - - Demographic Trends and Forecasts
J30 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - General

Cited by:
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  1. Donggyun Shin & Kwanho Shin, 2003. "Why Are The Wages of Job Stayers Procyclical?," ISER Discussion Paper 0573, Institute of Social and Economic Research, Osaka University. [Downloadable!]
  2. James Ted McDonald & Christopher Worswick, 2000. "Earnings and Employment Probabilities of Men by Education and Birth Cohort, 1982-96: Evidence for the United States, Canada and Australia," Carleton Economic Papers 00-04, Carleton University, Department of Economics. [Downloadable!]
  3. Crossley, T.F. & McDonald, J.T. & Worswick, C., 1999. "Immigrant Benefit Receipt: Sensitivity to the Choice of Survey years and Model Specification," ANUCBE School of Economics Working Papers 1999-370, Australian National University, College of Business and Economics, School of Economics. [Downloadable!]
    Other versions:
  4. Christian Calmès, 2005. "Self-Enforcing Labour Contracts and the Dynamics Puzzle," Working Papers 05-1, Bank of Canada. [Downloadable!]
  5. Martins, Pedro S. & Snell, Andy & Thomas, Jonathan P., 2009. "Real and Nominal Wage Rigidity in a Model of Equal-Treatment Contracting," IZA Discussion Papers 4346, Institute for the Study of Labor (IZA). [Downloadable!]
  6. repec:ese:iserwp: is not listed on IDEAS
  7. Leena Rudanko, 2008. "Aggregate and Idiosyncratic Risk in a Frictional Labor Market," Boston University - Department of Economics - Working Papers Series wp2008-009, Boston University - Department of Economics. [Downloadable!]
  8. Devereux, Paul J. & Hart, Robert A., 2005. "The Spot Market Matters: Evidence on Implicit Contracts from Britain," IZA Discussion Papers 1497, Institute for the Study of Labor (IZA). [Downloadable!]
    Other versions:
  9. Silke Anger, 2007. "The Cyclicality of Effective Wages within Employer-Employee Matches: Evidence from German Panel Data," SOEPpapers 34, DIW Berlin, The German Socio-Economic Panel (SOEP). [Downloadable!]
    Other versions:
  10. Bilgehan Karabay & John McLaren, 2009. "Trade, Offshoring, and the Invisible Handshake," NBER Working Papers 15048, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
  11. Andy Snell & Jonathan Thomas, 2006. " Labor Contracts, Equal Treatment and Wage-Unemployment Dynamics," CDMA Conference Paper Series 0603, Centre for Dynamic Macroeconomic Analysis. [Downloadable!]
    Other versions:
  12. Christopher A. Pissarides, 2007. "The Unemployment Volatility Puzzle: Is Wage Stickiness the Answer?," CEP Discussion Papers dp0839, Centre for Economic Performance, LSE. [Downloadable!]
  13. Jonathan Thomas & Andy Snell, . " Real and Nominal Wage Rigidity in a Model of Equal-Treatment Contracting," CDMA Conference Paper Series 0708, Centre for Dynamic Macroeconomic Analysis. [Downloadable!]
  14. Leena Rudanko, 2008. "Labor Market Dynamics under Long Term Wage Contracting," Boston University - Department of Economics - Working Papers Series wp2008-003, Boston University - Department of Economics. [Downloadable!]
    Other versions:
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This page was last updated on 2009-11-3.


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