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Wage and Labor Mobility in Denmark, 1980-2000 / Tor Eriksson, Niels Westergaard-Nielsen.

By: Contributor(s): Material type: TextTextSeries: Working Paper Series (National Bureau of Economic Research) ; no. w13064.Publication details: Cambridge, Mass. National Bureau of Economic Research 2007.Description: 1 online resource: illustrations (black and white)Subject(s): Online resources: Available additional physical forms:
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Abstract: This paper consists of three parts. First, we briefly describe some key features of the labor market in Denmark, some of which contribute to the Danish labor markets behaving quite differently from those in many other European countries. The next two parts exploit detailed linked employer-employee data. In the second part we document in some detail an important aspect of the functioning and flexibility of the labor markets in Denmark: the high level of worker mobility. We show that mobility is about as high, or even higher, as in the highly fluid U.S. labor market. Finally, we describe and examine the wage structure between and within firms and changes therein since 1980, especially with an eye on possible impacts of the trend towards a more decentralized wage determination. The shift towards decentralized wage bargaining has coincided with deregulation and increased product market competition. The evidence is, however, not consistent with stronger competition in product markets eroding firm-specific rents. Hence, the prime suspect is the change in wage setting institutions.
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April 2007.

This paper consists of three parts. First, we briefly describe some key features of the labor market in Denmark, some of which contribute to the Danish labor markets behaving quite differently from those in many other European countries. The next two parts exploit detailed linked employer-employee data. In the second part we document in some detail an important aspect of the functioning and flexibility of the labor markets in Denmark: the high level of worker mobility. We show that mobility is about as high, or even higher, as in the highly fluid U.S. labor market. Finally, we describe and examine the wage structure between and within firms and changes therein since 1980, especially with an eye on possible impacts of the trend towards a more decentralized wage determination. The shift towards decentralized wage bargaining has coincided with deregulation and increased product market competition. The evidence is, however, not consistent with stronger competition in product markets eroding firm-specific rents. Hence, the prime suspect is the change in wage setting institutions.

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