Compensating wages under different exchange rate regimes

Arbeitspapier

This paper analyses the interconnectedness between developing countries' domestic wage levels and their exchange rate choices. The theoretical model illustrates that differences in domestic wage levels are related to countries' exchange rate regimes. In particular, the level of domestic wages increases with the rigidity of the exchange rate regime. The empirical model explores the determinants of the domestic wage level in a cross-section of 38 developing countries. In line with the theoretical model, the economies under review experience a rise in the domestic wage level with an increase in the rigidity of their exchange rate regime.

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Series: CFR Working Paper ; No. 05-04

Classification and Topics

• Classification: Wirtschaft ; International Monetary Arrangements and Institutions ; Open Economy Macroeconomics
• Subject: Exchange Rate Regimes ; Factor Prices ; Monetary Policy ; Uncertainty

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Hoffmann, Mathias
• Event: Veröffentlichung
• (who): University of Cologne, Centre for Financial Research (CFR)
• (where): Cologne
• (when): 2005

Further information

• Handle: http://hdl.handle.net/10419/57756
• Last update: 10.03.2025, 11:44 AM CET