Empirical Economics

, Volume 49, Issue 3, pp 1143–1152 | Cite as

A replication note on downward nominal and real wage rigidity: survey evidence from European firms

  • Daniel A. Dias
  • Carlos R. Marques
  • Fernando MartinsEmail author


This note shows that the models estimated in Babecký et al. (Scand J Econ 112(4):884–910, 2010) do not allow identifying the determinants of downward nominal wage rigidity and provides new empirical evidence on the importance of downward nominal wage rigidity and its determinants in several European countries.


Base-wage rigidity Wage freezes Wage cuts Probit model 

JEL Classification

C35 J31 J50 



The authors would like to thank Claudia Duarte and Pedro Portugal for helpful discussions and useful suggestions.


  1. Altonji JG, Devereux PJ (2000) The extent and consequences of downward nominal wage rigidity. In: Worker well-being, vol 19. Elsevier, Amsterdam, pp 383–431Google Scholar
  2. Babecký J, Caju PD, Kosma T, Lawless M, Messina J, Room T (2010) Downward nominal and real wage rigidity: survey evidence from European firms. Scand J Econ 112(4):884–910CrossRefGoogle Scholar
  3. Caju PD, Fuss C, Wintr L (2007) Downward wage rigidity for different workers and firms: an evaluation for belgium using the IWFP procedure. Working Paper Series 840, European Central BankGoogle Scholar
  4. Caju PD, Fuss C, Wintr L (2009) Understanding sectoral differences in donward real wage rigidity: workforce composition, institutions, tecnology and competition. Working Paper Series 1006, European Central BankGoogle Scholar
  5. Card D, Hyslop D (1997) Does inflation “grease the wheels of the labor market”? In: Romer CD, Romer DH (eds) Reducing inflation: motivation and strategy. University of Chicago Press, ChicagoGoogle Scholar
  6. Dias D, Marques CR, Martins F (2012) Identifying the determinants of downward wage rigidity: Some methodological considerations and new empirical evidence. Working Paper Series 15, Banco de PortugalGoogle Scholar
  7. Dickens WT, Goette L (2006) Estimating wage rigidity for the international wage flexibility project. Mimeo, Brookings InstitutionGoogle Scholar
  8. Dickens WT, Goette L, Groshen EL, Holden S, Messina J, Schweitzer ME, Turunen J, Ward ME (2007) How wages change: micro evidence from the International Wage Flexibility Project. J Econ Perspect 21(2):195–214CrossRefGoogle Scholar
  9. Druant M, Fabiani S, Kezdi G, Lamo A, Martins F, Sabbatini R (2009) How are firms’ wages and prices linked: survey evidence in Europe. Working Paper Series 1084, European Central BankGoogle Scholar
  10. Fehr E, Goette L (2005) Robustness and real consequences of nominal wage rigidity. J Monet Econ 52(4):779–804CrossRefGoogle Scholar
  11. Goette L, Sunde U, Bauer T (2007) Wage rigidity: measurement, causes and consequences. Econ J 117(524):F499–F507CrossRefGoogle Scholar
  12. Holden S (2004) The costs of price stability: downward nominal wage rigidity in Europe. Economica 71:183–208CrossRefGoogle Scholar
  13. Holden S, Wulfsberg F (2008) Downward nominal wage rigidity in the OECD. BE J Macroecon 8(1):(Advances), Article 15Google Scholar
  14. Kahn S (1997) Evidence of nominal wage stickiness from microdata. Am Econ Rev 87(5):993–1008Google Scholar
  15. King G, Zeng L (2001) Logistic regression in rare events data. Polit Anal 9(2):137–163CrossRefGoogle Scholar
  16. Knoppik C, Beissinger T (2009) Downward nominal wage rigidity in Europe: an analysis of European micro data from the ECHP 1994–2001. Empir Econ 36(2):321–338CrossRefGoogle Scholar
  17. Messina J, Duarte CF, Izquierdo M, Caju PD, Hansen NL (2010) The incidence of nominal and real wage rigidity: an individual-based sectoral approach. J Eur Econ Assoc 8(2–3):487–496CrossRefGoogle Scholar

Copyright information

© Springer-Verlag Berlin Heidelberg 2015

Authors and Affiliations

  • Daniel A. Dias
    • 1
    • 2
  • Carlos R. Marques
    • 3
  • Fernando Martins
    • 3
    • 4
    • 5
    Email author
  1. 1.Department of EconomicsUniversity of Illinois at Urbana-ChampaignUrbanaUSA
  2. 2.CEMAPRELisbonPortugal
  3. 3.Research DepartmentBanco de PortugalLisbonPortugal
  4. 4.ISEGTechnical University of LisbonLisbonPortugal
  5. 5.Universidade Lusíada de LisboaLisbonPortugal

Personalised recommendations