Hostname: page-component-586b7cd67f-2plfb Total loading time: 0 Render date: 2024-11-25T22:07:00.578Z Has data issue: false hasContentIssue false
  • English
  • Français

Monetary regimes and the endogeneity of labour market structures: empirical evidence from Denmark, 1875–2007

Published online by Cambridge University Press:  01 August 2009

KIM ABILDGREN
KIM ABILDGREN*
Affiliation:
Havnegade 5, Economics Department, Danmarks Nationalbank, Copenhagen, DK-1093, Denmark, [email protected]
Get access

Abstract

This article traces links between the monetary regime and some institutions of the labour market in Denmark over the past century. The results indicate that elements of the labour market are endogenous. The longest wage contract terms are found towards the end of the pre-World War I classical gold standard period – characterised by price-level stability – and during the period since the mid 1990s that has seen a firm fixed exchange-rate policy and low and stable inflation. The shortest contract lengths are observed in the interwar period with high inflation volatility. Inflation indexation of wages was used most extensively in the Bretton Woods period and during the soft peg period of the 1970s when inflation was high and rising. The degree of nominal wage rigidity in the economy is therefore not necessarily approximately constant, as it is otherwise assumed in many New Keynesian models.

Type
Research Article
Information
European Review of Economic History , Volume 13 , Issue 2 , August 2009 , pp. 199 - 218
Copyright
Copyright © European Historical Economics Society 2009

Access options

Get access to the full version of this content by using one of the access options below. (Log in options will check for institutional or personal access. Content may require purchase if you do not have access.)

References

Abildgren, K. (2005). Real effective exchange rates and purchasing-power-parity convergence: empirical evidence for Denmark, 1875–2002. Scandinavian Economic History Review 53, pp. 58–70.Google Scholar
Abildgren, K. (2008). Are labour market structures endogenously dependent on the monetary regime? Empirical evidence from Denmark, 1875–2007. Danmarks Nationalbank Working Paper 52.Google Scholar
Christensen, J. P. (1975). Lønudviklingen inden for dansk håndværk og industri 1870–1914. Copenhagen: Akademisk forlag.Google Scholar
Christensen, L. K., Hansen, A. E. and Kolstrup, S. (2007). Arbejdernes historie i Danmark 1800–2000. SFAHs skriftserie 46.Google Scholar
Christofides, L. N. and Peng, C. (2006). Contract duration and indexation in a period of real and nominal uncertainty. Labour Economics 13, pp. 61–86.CrossRefGoogle Scholar
DA (2007). Lønstatistik 1907–2007. Copenhagen: DA.Google Scholar
Dansk Arbejdsgiver- og Mesterforening (1907). Et lønstatistisk Kontor under Arbejdsgiverforeningen. Arbejdsgiveren 8, p. 1.Google Scholar
De Grauwe, P. and Mongelli, F. P. (2004). Endogeneities of optimum currency areas. In Sørensen, P. B. (ed.), Monetary Union in Europe. Historical Perspectives and Prospects for the Future. Essays in Honour of Niels Thygesen. Copenhagen: DJØF Publishing.Google Scholar
Det Økonomiske Råd Formandskabet (2007). Dansk Økonomi Forår 2007. Copenhagen: Schultz.Google Scholar
Due, J., Jensen, C. S., Madsen, J. S. and Petersen, L. K. (1994). The Survival of the Danish Model: A Historical Sociological Analysis of the Danish System of Collective Bargaining. Copenhagen: DJØF Publishing.Google Scholar
Fregert, K. and Jonung, L. (1998). Monetary regimes and endogenous wage contracts: Sweden 1908–1995. Lund University Department of Economics Working Paper 3.Google Scholar
Fregert, K. and Jonung, L. (2008). Inflation targeting is a success, so far: 100 years of evidence from Swedish wage contracts. Economics: The Open-Access, Open Assessment E-Journal 2, pp. 1–25.Google Scholar
Galenson, W. (1952). The Danish System of Labour Relations: A Study in Industrial Peace. Cambridge, MA: Harvard University Press.Google Scholar
Galí, J. (2008). Monetary Policy, Inflation, and the Business Cycle. Princeton, NJ: Princeton University Press.Google Scholar
Gray, J. A. (1978). On indexation and contract length. Journal of Political Economy 86, pp. 1–18.CrossRefGoogle Scholar
Groth, C. and Johansson, Å. (2004). Bargaining structure and nominal wage flexibility. European Economic Review 48, pp. 1349–65.Google Scholar
Jensen, J. and Olsen, C. M. (1901). Oversigt over Fagforeningsbevægelsen i Danmark i tiden fra 1871 til 1900. Copenhagen: Bording.Google Scholar
Kærgård, N. (1991). Økonomisk vækst. En økonometrisk analyse af Danmark 1870–1981. Copenhagen: Jurist- og Økonomforbundets Forlag.Google Scholar
Lucas, R. E. Jr. (1976). Econometric policy evaluation: a critique. Carnegie-Rochester Conference Series on Public Policy 1, pp. 19–46.Google Scholar
Maigaard, J. (ed.) (1999). Maskinarbejdernes og de andre smedes Århundrede. Copenhagen: Fremad.Google Scholar
Nørregaard, G. (1943). Arbejdsforhold indenfor dansk Haandværk og Industri 1857–1899. Copenhagen: Nordisk Forlag.Google Scholar
Pedersen, P. J. (1984). Arbejdsmarkedet – Langtidstendenser og internationale perspektiver. Århus: Handelshøjskolen.Google Scholar
Woodford, M. (2003). Interest and Prices. Princeton, NJ: Princeton University Press.Google Scholar