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REAL WAGE CYCLICALITY IN THE PANEL STUDY OF INCOME DYNAMICS
Author(s) -
Swanson Eric T.
Publication year - 2007
Publication title -
scottish journal of political economy
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.4
H-Index - 46
eISSN - 1467-9485
pISSN - 0036-9292
DOI - 10.1111/j.1467-9485.2007.00433.x
Subject(s) - panel study of income dynamics , economics , overtime , wage , robustness (evolution) , panel data , labour economics , hourly wage , real wages , demographic economics , econometrics , biochemistry , chemistry , gene
Previous studies of real wage cyclicality have made only sparing use of the micro‐data detail that is available in the Panel Study of Income Dynamics (PSID). The present paper brings to bear this additional detail to investigate the robustness of the previous results and to examine whether there are important cross‐sectional and demographic differences in wage cyclicality. Although real wages were procyclical across the entire distribution of workers from 1967 to 1991, the wages of lower‐income, younger, and less‐educated workers exhibited greater procyclicality. However, workers' straight‐time hourly pay rates have been acyclical, suggesting that more variable pay margins such as bonuses, overtime, late shift premia, and commissions have played a substantial if not primary role in generating procyclicality.