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Table 12 Probability of adjusting flexible wages

From: European firm adjustment during times of economic crisis

 

Probability (% and standard errors)

Difference from baseline (% points and standard errors)

Baseline

13.7

 

(5.6)

 

Manufacturing

8.0

−5.8

(3.9)

(2.6)

Trade

8.3

−5.4

(4.1)

(2.8)

Large firm

12.9

−0.9

(5.1)

(3.4)

Strong demand + weak credit shock

16.7

3.0

(6.4)

(2.2)

Strong demand + strong credit shock

13.4

−0.4

(5.4)

(2.2)

Time-dependent wages

14.3

0.5

(5.8)

(2.1)

Frequent wage adjustment

8.6

−5.1

(4.4)

(2.6)

Strong competitive pressures

14.4

0.7

(5.7)

(1.9)

Firm-level collective agreement

12.8

−0.9

(5.5)

(2.2)

White-collar workers: high (%)

19.3

5.6

(7.4)

(3.3)

High-skilled workers: high (%)

17.2

3.4

(6.7)

(3.0)

Temporary workers: high (%)

11.2

−2.6

(4.9)

(2.1)

Labour cost share: high (%)

14.0

0.2

(5.6)

(2.2)

Flexible pay component: high (%)

21.3

7.5

(7.2)

(3.2)

  1. Source: WDN surveys. Note: The table shows predicted probability from probit regression. Standard errors are shown in parentheses. The baseline case is a Czech firm operating in the business service sector; of small size (5–19 employees); facing weak demand and credit shocks; setting wages without a firm-level, collectively bargained contract and without a particular time pattern at less than yearly frequency; a firm having a workforce with low shares of temporary, white-collar, and high-skilled workers; facing weak competitive pressures; and having a low share of wages in total costs and a low incidence of bonuses