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Do sticky wages matter? New evidence from matched firm-survey and register data

Anne Kathrin Funk & Daniel Kaufmann

Résumé This paper provides novel evidence on downward nominal wage rigidities and their allocative effects in Switzerland. We match individual wages from a bi-annual firm survey with information on annual income and employment from social security register data. We relevant downward nominal wage rigidities in the base wage, which accounts for more than 90% of employment income. We then identify the allocative effects of downward nominal wage rigidities on income and employment after an unexpected 1% decline of the consumer price level. Base wage rigidities cause a decline of aggregate income (-0.39%) and employment income (-0.97%), as well as an increase of unemployment (2.11%).
   
Mots-clés Downward nominal wage rigidity, income, unemployment, deflation
   
Citation Funk, A. K., & Kaufmann, D. (2020). Do sticky wages matter? New evidence from matched firm-survey and register data. Unpublished IRENE Working Paper. Université de Neuchâtel.
   
Type Working paper (Anglais)
Année 2020
Type de travail IRENE Working Paper
Département Institut de Recherches Economiques
Institution Université de Neuchâtel (Neuchâtel)
Nombre de pages 68
URL https://ideas.repec.org/p/irn/wpaper/20-06.html