The effect of labour tightness on wages at the regional level in Central Europe
Abstract I estimate the effect of tightness on wages in Hungary and Slovakia. The Mortensen Pissarides model predicts a positive relationship but the empirical evidence is scarce. I instrument tightness by the distance of a district from the Austrian border, interacted with a dummy that marks the op...
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| Main Author: | |
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| Format: | Article |
| Language: | English |
| Published: |
SpringerOpen
2024-12-01
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| Series: | Journal for Labour Market Research |
| Subjects: | |
| Online Access: | https://doi.org/10.1186/s12651-024-00383-w |
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| Summary: | Abstract I estimate the effect of tightness on wages in Hungary and Slovakia. The Mortensen Pissarides model predicts a positive relationship but the empirical evidence is scarce. I instrument tightness by the distance of a district from the Austrian border, interacted with a dummy that marks the opening of the Austrian labour market to these countries in 2011. I find a positive effect of tightness on wages, which is in line with the conclusion of the models. If tightness increase by 1 per cent than ceteris paribus wages increase by roughly 0.2 per cent both in Hungary and Slovakia as well. |
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| ISSN: | 2510-5027 |