Title: Permanent Differences in Unemployment and Permanent Wage Differentials
Abstract:This paper tests for the existence of wage premiums based on geographic and industry unemployment differences. These differences are broken down into permanent and transitory components in equations c...This paper tests for the existence of wage premiums based on geographic and industry unemployment differences. These differences are broken down into permanent and transitory components in equations controlling for variation in state generosity of unemployment insurance benefits. Findings indicate that wage premiums arise for long-run unemployment differences, but that negative short-run shocks to industries generate wage cuts, while positive shocks generate wage hikes. Therefore, labor contracts accommodate long-term anticipated unemployment, and entail sharing of short-term unemployment risks.Read More
Publication Year: 1985
Publication Date: 1985-02-01
Language: en
Type: article
Indexed In: ['crossref']
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Cited By Count: 62
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