TY  - JOUR
AU  - Holzer,Harry J.
AU  - Montgomery,Edward B.
TI  - Asymmetries and Rigidities in Wage Adjustments by Firms
JF  - National Bureau of Economic Research Working Paper Series
VL  - No. 3274
PY  - 1990
Y2  - March 1990
UR  - http://www.nber.org/papers/w3274
L1  - http://www.nber.org/papers/w3274.pdf
N1  - Author contact info:
Harry J. Holzer
Georgetown University
3520 Prospect Street NW,4th Floor
Washington, DC  20007
E-Mail: hjh4@georgetown.edu

Edward B. Montgomery
Dean, Georgetown Public Policy Institute
Georgetown University
3520 Prospect Street NW, 4th Floor
Washington DC 20007
Tel: 202/687-7051
Fax: 202/687-1904
E-Mail: ebm48@georgetown.edu
AB  - In this paper we use micro data from the Employment Opportunity Pilot Project (EOPP) surveys of firms in 1980 and 1982 to test for labor market rigidities and asymmetries in response to demand shifts. We analyze wage and employment adjustments to positive and negative shifts, as measured by sales growth between 1979 and 1981. The analysis is done for both entire sample of firms and for selected subsamples based on firm size, unionization, industry and skill mix. The results show that wage adjustments appear to be fairly rigid, compared with employment adjustments. They also appear to be quite asymmetric, with significant adjustments in response to positive shifts but little adjustment in response to negative shifts. These asymmetries are not more pronounced in large firms, manufacturing, heavily-waged or highly-skilled  industries than in other firms or industries. In contrast, employment adjustments show no consistent pattern of asymmetry.
ER  -