Misalignment of productivity and wages across regions: evidence from Belgium

Abstract

This paper is one of the first to estimate how regions affect the productivity, wage cost and cost competitiveness (i.e., the productivity-wage gap) of firms. Detailed linked employer-employee panel data for Belgium and the Hellerstein-Neumark framework are used to estimate dynamic models at the establishment level. The findings show that interregional differences in productivity and wages are significant, but to a large extent due to drivers at the individual and/or firm level. The research provides evidence that the specificity of the Brussels region can be linked to its higher density compared with the rest of Belgium. Robustness tests suggest that the relatively better ceteris paribus performance of firms in Brussels is limited to the service sector.

Does Over-Education Raise Productivity and Wages Equally? The Moderating Role of Workers' Origin and Immigrants' Background

“…Considering Belgium's strong labour market institutions 36 and recent empirical evidence (Kampelmann et al, 2018a(Kampelmann et al, , 2018b(Kampelmann et al, , 2020, this "wage compression effect" is an 33 The only exception is for first-generation immigrants who arrived in Belgium after the age of 18. For this group, the effect of over-education is more significant on wages than on productivity.…”

Territorial disparities in labour productivity, wages and prices in Italy: What does the data show?

“…Disparities are large, for example, within Belgium, Germany, Poland, Spain and the UK (OECD, 2018). Within countries, wages also exhibit local variations that, at least in part, offset those in productivity, thus smoothing unit labour cost (ULC) differentials across territories (Adamchik and Hyclak, 2017;Broersma and Van Dijck, 2005;Kampelmann et al, 2018;Kluge and Weber, 2018). Furthermore, across regions and local areas, price levels also differ, reducing disparities in nominal incomes, productivity and wages (Blien et al, 2009;Janský and Kolcunová, 2017;Roos, 2006b).…”

Economic Dependence Relationship and Spatial Stratified Heterogeneity in the Eastern Coastal Economic Belt of China

“…More and more scholars carry out the research and analysis from the respect of institutional arrangement, functional positioning, competitiveness, and linkage development to analyze the coordinated and sustainable regional development, and the relevant research studies mainly focus on the coordination of system and main interests, industrial ecology, linkage, and sustainable development [13,14]. e literature on the spatial pattern of regional coordinated development mainly focuses on the spatial-temporal evolution of regional development gap [15], the spatial pattern of regional ecological difference [16], the influencing factors of regional development imbalance [17], the influencing factors of regional income gap [18], the influencing factors of regional green development [19], and the spatial pattern of urban-rural coordinated development [20]. Among them, Ma uses the theory of system dissipative structure to conduct quantitative research on the coordinated development of regional economy and establishes a system coordination evaluation model based on the grey relational theory with annual GDP as the order parameter, and evaluated and measured the degree of regional coordinated development [21].…”