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Pay Increases and Productivity: The British Experience

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  • Ingram, Peter

Abstract

One of the enduring problems of British economic management has been the mismatch between the rate of growth of wages and output per person. This paper investigates the relationship between pay and performance since 1980. Industry level analysis confirms the absence of a direct relationship between increases in earnings and the rate of growth in productivity. This result is also found at the level of the individual workplace using data from the CBI's wage settlement series which includes a productivity growth value. Even at this disaggregated level, though there is widespread movement in wage relativities, there is little direct connection with productivity. Copyright 1995 by Scottish Economic Society.

Suggested Citation

  • Ingram, Peter, 1995. "Pay Increases and Productivity: The British Experience," Scottish Journal of Political Economy, Scottish Economic Society, vol. 42(3), pages 310-330, August.
    • Handle: RePEc:bla:scotjp:v:42:y:1995:i:3:p:310-30
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