Nominal Wage Rigidity in the EU Countries Before and after the Great Recession: Evidence from the WDN Surveys

Restoring sustainable public finances in the aftermath of the Great Recession is a key challenge in most EU countries. In order to learn from history, our paper examines consolidation episodes in the EU since 1970. We shed light on the factors that favour the start of a consolidation episode and determine its success. Compared to the existing literature, we add a number of new dimensions in the analysis. First, we explore a broader set of potential ingredients of the ‘recipe for success‘, including the quality and strength of fiscal governance and the implementation of structural reforms. Secondly, we check whether the ‘recipe for success’ changed over time. Our analysis broadly confirms received wisdom concerning the conditions triggering a consolidation episode and the role of the composition of adjustment for success, with some qualifications related to the role played by government wages. In addition it provides evidence that well-designed fiscal governance as well as structural reforms improve the odds of both starting a consolidation episode and achieving a lasting fiscal correction. We also show that, over time, successful and unsuccessful consolidation episodes have become more similar in terms of adjustment composition.

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The Evaluation of Recession Magnitudes in EU Countries during the Great Recession 2008–2010

Review of Economic Perspectives ◽

10.1515/revecp-2016-0014 ◽

2016 ◽

Vol 16 (3) ◽

pp. 231-244 ◽

Cited By ~ 3

Author(s):

Jiří Mazurek

Keyword(s):

Great Recession ◽

Econometric Model ◽

Gdp Per Capita ◽

Economic Openness ◽

Eu Countries ◽

The Great Recession ◽

The Great Depression ◽

The Usa ◽

Per Capita ◽

The Eu

Abstract The aim of this article is to compare 2008-2010 recession magnitudes in individual EU countries. For the comparison the recession magnitude scale was used. The strongest recession during the examined period took place in Latvia, Estonia, Lithuania, Greece and Ireland, while the weakest recessions in the EU occurred in France, Malta and Cyprus. Poland and Slovakia were the only two EU countries that didn’t fall into a recession, that’s why they were not included in the study. The main findings of the paper are that EU19’s recession was much smaller than both the Great Depression of the 1930s and the recent Great Recession in the USA. Furthermore, with the use of a linear econometric model it was found that recession magnitudes in EU countries were directly proportional to the countries’ GDP per capita in 2008 and growth prior to recessions, while countries’ economic openness was indirectly proportional to recession magnitudes, all the relationships being statistically significant.

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Some Efficiency Effects of Inflation Under Nominal Wage Rigidity

SSRN Electronic Journal ◽

10.2139/ssrn.1693248 ◽

2009 ◽

Author(s):

Alexander Tepper

Keyword(s):

Wage Rigidity ◽

Nominal Wage ◽

Nominal Wage Rigidity ◽

Efficiency Effects

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The Firm, Wage Indexation, and Nominal Wage Rigidity

SSRN Electronic Journal ◽

10.2139/ssrn.2735095 ◽

2016 ◽

Author(s):

James M. Holmes ◽

John M. Holmes ◽

Patricia A. Hutton

Keyword(s):

Wage Rigidity ◽

Nominal Wage ◽

Wage Indexation ◽

Nominal Wage Rigidity

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Downward Nominal Wage Rigidity and Determinacy of Equilibrium

SSRN Electronic Journal ◽

10.2139/ssrn.3655101 ◽

2020 ◽

Author(s):

Tomohide Mineyama

Keyword(s):

Wage Rigidity ◽

Nominal Wage ◽

Nominal Wage Rigidity

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Financial Crises and the Public Discourse on Financial Elites

10.1093/oso/9780198782797.003.0002 ◽

2018 ◽

Author(s):

Youssef Cassis ◽

Giuseppe Telesca

Keyword(s):

Great Depression ◽

Great Recession ◽

Public Discourse ◽

Codes Of Conduct ◽

The Public ◽

The Great Recession ◽

The Great Depression ◽

Early Twenty ◽

Before And After ◽

Late Twentieth

Why were elite bankers and financiers demoted from ‘masters’ to ‘servants’ of society after the Great Depression, a crisis to which they contributed only marginally? Why do they seem to have got away with the recent crisis, in spite of their palpable responsibilities in triggering the Great Recession? This chapter provides an analysis of the differences between the bankers of the Great Depression and their colleagues of the late twentieth/early twenty-first century—regarding their position within, and attitude towards the firm, work culture, mental models, and codes of conduct—complemented with a scrutiny of the public discourse on bankers and financiers before and after the two crises. The authors argue that the (relative) mildness of the Great Recession, compared to the Great Depression, has contributed to preserve elite bankers’ and financiers’ status, income, wealth, and influence. Yet, the long-term consequences of their loss of reputational capital are difficult to assess.

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