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Linked Personnel Panel (LPP) – Special survey about the Corona-Pandemic

Author

Listed:
  • Frodermann, Corinna

    (Institute for Employment Research (IAB), Nuremberg, Germany)

  • Grunau, Philipp

    (Institute for Employment Research (IAB), Nuremberg, Germany)

  • Hauschka, Gloria

    (Institute for Employment Research (IAB), Nuremberg, Germany)

  • Haepp, Tobias

    (Institute for Employment Research (IAB), Nuremberg, Germany)

  • Mackeben, Jan

    (Institute for Employment Research (IAB), Nuremberg, Germany)

  • Ruf, Kevin

    (Institute for Employment Research (IAB), Nuremberg, Germany)

  • Wanger, Susanne

    (Institute for Employment Research (IAB), Nuremberg, Germany)

  • Walz, Hannes

    (Institute for Employment Research (IAB), Nuremberg, Germany)

Abstract

"We analyze the behavior of plant-level real wages and productivity in Turkish manufacturing after the transition to democracy in 1987 and test whether wages under democracy causes productivity. The Turkish experience provides almost an experimental case: real wages in manufacturing increased by 120% in the 1987-93 period due to (exogenous) political changes, together with unprecedented total factor productivity and labor productivity growth. While these observations provide support for the “democracies pay higher wages” hypothesis, they also stimulate further evaluation of the consequences of such politically-motivated “exogenous” wage hikes on economic performance. Our analysis shows that real wage hikes during the democratic transition forced firms to increase productivity to stay competitive. The findings also help explain why countries that undergo an orderly transition from autocracy to democracy may achieve rapid productivity gains." (Author's abstract, IAB-Doku) ((en))

Suggested Citation

  • Frodermann, Corinna & Grunau, Philipp & Hauschka, Gloria & Haepp, Tobias & Mackeben, Jan & Ruf, Kevin & Wanger, Susanne & Walz, Hannes, 2021. "Linked Personnel Panel (LPP) – Special survey about the Corona-Pandemic," FDZ-Datenreport. Documentation on Labour Market Data 202108 (en), Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany].
    • Handle: RePEc:iab:iabfda:202108(en)
    DOI: 10.5164/IAB.FDZD.2108.en.v1
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