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Wage Change and Trade Performance in U.S. Manufacturing Industries

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  • Galbraith, James K
  • Calmon, Paulo Du Pin

Abstract

This paper presents empirical measurement of wage contours in US industry, 1959-88, applying cluster analysis to the path of change of average hourly wages. We define six principal industrial clusters and present simple wage-change equations for each cluster. A series of tests shows that the 'rules of the economic game' differ across our industrial groups: industrial structure matters to wage outcomes. Finally, we present the evolving relationship between relative wage levels and the comparative trade performance of the clusters. The results suggest a strong association between trade performance and the evolving industrial wage structure, contrary to the findings of some other recent studies. We conclude that the reclassification of industrial data along lines specific to the problem being studied is an important analytical step, whose neglect in previous work has led some researchers to understate the influence of industrial structure and trade pressures on wages. (c) 1996 Academic Press Limited Copyright 1996 by Oxford University Press.

Suggested Citation

  • Galbraith, James K & Calmon, Paulo Du Pin, 1996. "Wage Change and Trade Performance in U.S. Manufacturing Industries," Cambridge Journal of Economics, Cambridge Political Economy Society, vol. 20(4), pages 433-450, July.
    • Handle: RePEc:oup:cambje:v:20:y:1996:i:4:p:433-50
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    Cited by:

    1. Zakhilwal, Omar, 2001. "The Impact of International Trade on the Wages of Canadians," Analytical Studies Branch Research Paper Series 2001156e, Statistics Canada, Analytical Studies Branch.
    2. Konstantakis, Konstantinos N. & Michaelides, Panayotis G., 2017. "Does technology cause business cycles in the USA? A Schumpeter-inspired approach," Structural Change and Economic Dynamics, Elsevier, vol. 43(C), pages 15-26, December.
    3. Vesna Stavrevska, 2011. "The efficiency wages perspective to wage rigidity in the open economy: a survey," International Journal of Manpower, Emerald Group Publishing Limited, vol. 32(3), pages 273-299, June.
    4. Almeida, Lucas Milanez de Lima & Balanco, Paulo Antonio de Freitas, 2020. "Application of multivariate analysis as complementary instrument in studies about structural changes: An example of the multipliers in the US economy," Structural Change and Economic Dynamics, Elsevier, vol. 53(C), pages 189-207.

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