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Table 3 Long-run and short-run relation between manufacturing and government compensations per employee, conditional on government wage setting model, EU countries 1980–2013

From: Co-movements between public and private wages in the EU: what factors and with what policy implications?

  (1) (2) (3) (4)
  Dynamic long-run relation Error correction model
  Bargaining Decision Bargaining Decision
Dependent variable: manufacturing compensations, level and change (log)
∆ log government compensations p.e.    0.360*** 0.215***
    [6.745] [5.980]
∆ log productivity in manufacturing    0.156** 0.218***
    [3.324] [4.935]
∆ unemployment rate    −0.00210* −0.00155
    [−2.199] [−1.405]
∆ log consumer price index    0.629*** 0.705***
    [6.781] [24.51]
Log of consumer price index 0.458*** 0.705***   
  [5.945] [7.019]   
Log of government compensations p.e. 0.528*** 0.481***   
  [9.669] [5.083]   
Log of productivity in manufacturing 0.241*** 0.0941**   
  [11.28] [2.191]   
Unemployment rate −0.00676*** 0.00166   
  [3.875] [0.621]   
Lagged error correction term    −0.146*** −0.142**
    [−3.670] [−2.891]
Constant −0.753*** −2.367*** 0.00593* 0.00639**
  [−5.667] [−6.757] [1.905] [2.456]
Observations 224 183 224 183
R 2 0.993 0.987 0.637 0.643
Number of countries 8 9 8 9
  1. Estimation method: dynamic OLS with fixed effects and Newey West standard errors and ECM with standard errors robust with respect to heteroskedasticity and non-independence within country clusters. Sample: EU countries, except AT, BG, CY, DE, EL, HR, LT, LV, MT, RO and SI
  2. Robust t-statistics: ***p < 0.01; **p < 0.05; *p < 0.1