TITLE:
Market Regulation, Labor Policies and the Wage-Productivity Gap
AUTHORS:
Riccardo Tilli, Andrea Rollin
KEYWORDS:
Taxation, Labor Market Policies, Labor and Goods Market Regulation, Wage, Productivity
JOURNAL NAME:
Modern Economy,
Vol.8 No.3,
March
7,
2017
ABSTRACT: This paper proposes an empirical analysis about the
influence of some institutional factors (taxation, active and passive labor
market policies, labor and goods market regulation and unions’ participation)
on the component of the wage growth not explained by the productivity growth
(WP gap, thereafter). We consider a 14 OECD countries Panel Data over the
period 1983-2003, using four different estimations: fixed effects vector
decomposition (FEVD), fixed effects (FE), random effects (RE) and feasible
general least square (FGLS). Results for all estimations show that the WP gap
is affected by tax wedge, active labor market policies, employment protection
for temporary workers and union density, while product market regulation and
passive labor market policies do not play a significant role.