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International Advances in Economic Research

, Volume 8, Issue 4, pp 314–323 | Cite as

Disentangling the wage-productivity relationship: Evidence from select OECD member countries

  • Meghan Millea
Articles

Abstract

Conventional theory proposes that firms reward productivity improvements with higher wages. Conversely, efficiency wage theory suggests that wages can induce greater productivity. This paper applies a statistical technique that disentangles the potential bidirectional feedback between wages and productivity. Wage strategies in six industrialized countries with various labor market institutions are examined. Conventional and efficiency wage practices vary systematically across the industrialized countries; these variations are consistent with the expected effects of labor market institutions.

Keywords

Economic Growth Labor Market Statistical Technique International Economic Industrialize Country 
These keywords were added by machine and not by the authors. This process is experimental and the keywords may be updated as the learning algorithm improves.

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Copyright information

© International Atlantic Economic Society 2002

Authors and Affiliations

  • Meghan Millea
    • 1
  1. 1.Mississippi State UniversityU.S.A.

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