IDEAS home Printed from https://ideas.repec.org/a/sae/ilrrev/v53y1999i1p103-122.html
   My bibliography  Save this article

Inflation Stabilization and the Vanishing Size-Wage Effect

Author

Listed:
  • Christopher Woodruff

Abstract

The author examines wage patterns under an incomes policy in Mexico in 1987–94. The policy specified increases in the minimum wage rate, but also guided salary negotiations more generally. The author finds indications of a substantial but largely temporary effect on wage rates, and evidence consistent with more intensive monitoring of compliance in large firms than in smaller ones. For example, three years after policy implementation, public sector wages had fallen approximately 10% relative to private sector wages, and wages in the largest private firms had fallen 15% relative to those in the smallest private firms. These relative wage effects are consistent with the centralized administration of the policy.

Suggested Citation

  • Christopher Woodruff, 1999. "Inflation Stabilization and the Vanishing Size-Wage Effect," ILR Review, Cornell University, ILR School, vol. 53(1), pages 103-122, October.
    • Handle: RePEc:sae:ilrrev:v:53:y:1999:i:1:p:103-122
    DOI: 10.1177/001979399905300106
    as

    Download full text from publisher

    File URL: https://journals.sagepub.com/doi/10.1177/001979399905300106
    Download Restriction: no
    File URL: https://libkey.io/10.1177/001979399905300106?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. Revenga, Ana, 1997. "Employment and Wage Effects of Trade Liberalization: The Case of Mexican Manufacturing," Journal of Labor Economics, University of Chicago Press, vol. 15(3), pages 20-43, July.
    2. Eli Berman & John Bound & Zvi Griliches, 1994. "Changes in the Demand for Skilled Labor within U. S. Manufacturing: Evidence from the Annual Survey of Manufactures," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 109(2), pages 367-397.
    3. John Williamson, 1994. "The Political Economy of Policy Reform," Peterson Institute Press: All Books, Peterson Institute for International Economics, number 68, January.
    4. Carrington, William J & McCue, Kristin & Pierce, Brooks, 1996. "The Role of Employer-Employee Interactions in Labor Market Cycles: Evidence from the Self-Employed," Journal of Labor Economics, University of Chicago Press, vol. 14(4), pages 571-602, October.
    5. Reid, Frank, 1981. "Control and Decontrol of Wages in the United States: An Empirical Analysis," American Economic Review, American Economic Association, vol. 71(1), pages 108-120, March.
    6. Mahmood A. Zaidi, 1986. "Do Incomes Policies Restrain Wage Inflation? Some Evidence From Australia, Canada, and the United States," The Economic Record, The Economic Society of Australia, vol. 62(4), pages 468-484, December.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. David Fairris & Gurleen Popli & Eduardo Zepeda, 2008. "Minimum Wages and the Wage Structure in Mexico," Review of Social Economy, Taylor & Francis Journals, vol. 66(2), pages 181-208.
    2. Eréndira León Bravo, 2022. "Three essays on education, wages, and the labour market in Mexico," Economics PhD Theses 0322, Department of Economics, University of Sussex Business School.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Yoshinori Kurokawa, 2011. "Variety-skill complementarity: a simple resolution of the trade-wage inequality anomaly," Economic Theory, Springer;Society for the Advancement of Economic Theory (SAET), vol. 46(2), pages 297-325, February.
    2. Hoekman & Bernard & Winters, L. Alan, 2005. "Trade and employment : stylized facts and research findings," Policy Research Working Paper Series 3676, The World Bank.
    3. Chiquiar, Daniel, 2008. "Globalization, regional wage differentials and the Stolper-Samuelson Theorem: Evidence from Mexico," Journal of International Economics, Elsevier, vol. 74(1), pages 70-93, January.
    4. Jorge Saba Arbache, 2001. "Trade Liberalisation and Labor Markets in Developing Countries: Theory and Evidence," Studies in Economics 0112, School of Economics, University of Kent.
    5. Gordon H. Hanson & Ann Harrison, 2022. "Trade Liberalization And Wage Inequality In Mexico," World Scientific Book Chapters, in: Globalization, Firms, and Workers, chapter 3, pages 43-60, World Scientific Publishing Co. Pte. Ltd..
    6. Atolia, Manoj & Kurokawa, Yoshinori, 2016. "The impact of trade margins on the skill premium: Evidence from Mexico," Journal of Policy Modeling, Elsevier, vol. 38(5), pages 895-915.
    7. Rita K. Almeida, 2010. "Openness and Technological Innovation in East Asia: Have They Increased the Demand for Skills?," Asia-Pacific Development Journal, United Nations Economic and Social Commission for Asia and the Pacific (ESCAP), vol. 17(1), pages 63-95, June.
    8. Sivadasan, Jagadeesh & Slemrod, Joel, 2008. "Tax law changes, income-shifting and measured wage inequality: Evidence from India," Journal of Public Economics, Elsevier, vol. 92(10-11), pages 2199-2224, October.
    9. repec:wsr:fiwspe:y:2012:i:003 is not listed on IDEAS
    10. Zadia M. Feliciano, 2001. "Workers and Trade Liberalization: The Impact of Trade Reforms in Mexico on Wages and Employment," ILR Review, Cornell University, ILR School, vol. 55(1), pages 95-115, October.
    11. Yoshinori Kurokawa, 2014. "A Survey Of Trade And Wage Inequality: Anomalies, Resolutions And New Trends," Journal of Economic Surveys, Wiley Blackwell, vol. 28(1), pages 169-193, February.
    12. Rafaelita Aldaba, . "Impact of Trade Liberalization on Wage Skill Premium in Philippine Manufacturing," Chapters, in: Chine Hee HAHN & Dionisius Narjoko (ed.), Impact of Globalization on Labor Market, chapter 4, pages 69-105, Economic Research Institute for ASEAN and East Asia (ERIA).
    13. Jim Airola & Chinhui Juhn, 2008. "Wage Inequality in Post-Reform Mexico," Journal of Income Distribution, Ad libros publications inc., vol. 17(1), pages 110-134, March.
    14. Thierry Verdier, 2005. "Intégration commerciale « socialement responsable » : une approche en termes d'économie politique," Revue d’économie du développement, De Boeck Université, vol. 13(4), pages 55-121.
    15. Mehta, Aashish & Mohr, Belinda Acuña, 2012. "Economic Liberalization and Rising College Premiums in Mexico: A Reinterpretation," World Development, Elsevier, vol. 40(9), pages 1908-1920.
    16. Pavcnik, Nina, 2003. "What explains skill upgrading in less developed countries?," Journal of Development Economics, Elsevier, vol. 71(2), pages 311-328, August.
    17. Jonas Hjort & Jonas Poulsen, 2019. "The Arrival of Fast Internet and Employment in Africa," American Economic Review, American Economic Association, vol. 109(3), pages 1032-1079, March.
    18. repec:ilo:ilowps:365055 is not listed on IDEAS
    19. Jim Airola & Chinhui Juhn, 2008. "Wage Inequality in Post-Reform Mexico," Journal of Income Distribution, Ad libros publications inc., vol. 17(1), pages 110-134, March.
    20. Kjell G. Salvanes & Svein Erik Førre, 2001. "Job Creation, Heterogeneous Workers and Technical Change: Matched Worker/Plant Data Evidence from Norway," Discussion Papers 304, Statistics Norway, Research Department.
    21. Robbins, Donald J., 2003. "The impact of trade liberalization upon inequality in developing countries : a review of theory and evidence," ILO Working Papers 993650553402676, International Labour Organization.
    22. Jorge Saba Arbache, 1998. "How do Economic Reforms affect the Structure of Wages? The Case of Brazilian Manufacturing, 1984-1996," Studies in Economics 9817, School of Economics, University of Kent.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:sae:ilrrev:v:53:y:1999:i:1:p:103-122. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: SAGE Publications (email available below). General contact details of provider: http://www.ilr.cornell.edu .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.