Skills, Wages, and Employment in East and West Germany

January 1, 1995

Disclaimer: This Working Paper should not be reported as representing the views of the IMF.The views expressed in this Working Paper are those of the author(s) and do not necessarily represent those of the IMF or IMF policy. Working Papers describe research in progress by the author(s) and are published to elicit comments and to further debate

Summary

Disaggregated data from 30 two-digit manufacturing industries in the east and west parts of unified Germany are used to estimate employment for three skill categories of blue collar workers. Employment elasticities are uniformly higher in the east, and for unskilled labor. The former result contradicts union claims that wages had little relevance for east German job losses, while the latter confirms the capital-skill complementarity hypothesis.

Subject: Employment, Labor, Labor demand, Real wages, Wage adjustments, Wages

Keywords: Eastern Europe, egalitarian wage structure, elasticities fall, Employment, Labor demand, labor demand function, long-run wage elasticity, Real wages, Wage adjustments, wage cost, wage demand, wage development, wage distribution, wage elasticity, wage push, wage rate, wage-employment elasticity, Wages, WP

Pages:
24
Volume:
1995
DOI:
https://doi.org/10.5089/9781451841985.001
Issue:
004
Series:
Working Paper No. 1995/004
Stock No:
WPIEA0041995
ISBN:
9781451841985
ISSN:
1018-5941

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