What Survey Data Reveal About Price and Wage Rigidity in Portugal

19 Pages Posted: 4 Aug 2015

See all articles by Fernando Martins

Fernando Martins

Bank of Portugal - Research Department; University of Lisbon - School of Economics and Management; Universidade Lusíada, Lisboa

Date Written: September 2015

Abstract

This paper exploits the information collected from a survey conducted on a sample of Portuguese firms to study the patterns of firms’ price and wage adjustments and the extent of nominal price and wage rigidities. The evidence shows that the frequency of price changes varies substantially across sectors and depends on the intensity of competition, the share of labor costs and firms’ price reviewing behavior. The results also suggest that the constraint imposed by the presence of downward nominal wage rigidity is less important in firms where the fraction of permanent and high‐skilled workers is lower and the share of flexible pay components is higher.

JEL Classification: D21, E30, J30

Suggested Citation

Martins, Fernando, What Survey Data Reveal About Price and Wage Rigidity in Portugal (September 2015). LABOUR, Vol. 29, Issue 3, pp. 291-309, 2015, Available at SSRN: https://ssrn.com/abstract=2639425 or http://dx.doi.org/10.1111/labr.12056

Fernando Martins (Contact Author)

Bank of Portugal - Research Department ( email )

Av. Almirante Reis 71, 6th
Lisbon 1150-012
Portugal

University of Lisbon - School of Economics and Management ( email )

Rua do Quelhas, n.º 6
Lisbon, 1200-781
Portugal

Universidade Lusíada, Lisboa ( email )

Rua da Junqueira, 188 - 198
Lisboa, 1349-001
Portugal

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