IDEAS home Printed from https://ideas.repec.org/p/edn/esedps/312.html
   My bibliography  Save this paper

Implicit Contracts and Asymmetric Pass-through of Productivity Shocks

Author

Listed:
  • Stuart A. Breslin

    (School of Economics, University of Edinburgh)

  • Andy Snell

    (School of Economics, University of Edinburgh)

  • Heiko Stueber

    (University of Applied Labour Studies (UALS), Institute for Employment Research (IAB), Friedrich-Alexander-Universitaet Erlangen-Nuernberg (FAU), IZA)

  • Jonathan P. Thomas

    (School of Economics, University of Edinburgh)

Abstract

We document distinctive empirical features of wage pass-through in Germany that are consistent with Thomas-Worrall wage contracting in the presence of both idiosyncratic and nonstationary aggregate productivity components. These empirical features are hard to reconcile with the predictions of search models based on period-by-period Nash bargaining over match surplus and with the predictions of financial models where risk neutral firms may costlessly shield risk averse workers from idiosyncratic shocks (Guiso, Pistaferri et al. 2005).

Suggested Citation

  • Stuart A. Breslin & Andy Snell & Heiko Stueber & Jonathan P. Thomas, 2023. "Implicit Contracts and Asymmetric Pass-through of Productivity Shocks," Edinburgh School of Economics Discussion Paper Series 312, Edinburgh School of Economics, University of Edinburgh.
    • Handle: RePEc:edn:esedps:312
    as

    Download full text from publisher

    File URL: http://www.econ.ed.ac.uk/papers/id312_esedps.pdf
    Download Restriction: no
    ---><---

    More about this item

    Keywords

    Labour contracts; pass-through; limited commitment; asymmetric shocks;
    All these keywords.

    JEL classification:

    • E32 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Business Fluctuations; Cycles
    • J41 - Labor and Demographic Economics - - Particular Labor Markets - - - Labor Contracts

    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:edn:esedps:312. 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.

    We have no bibliographic references for this item. You can help adding them by using 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: Research Office (email available below). General contact details of provider: https://edirc.repec.org/data/deediuk.html .

    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.