Democracies pay higher wages
By: Dani Rodrik.
Contributors: National Bureau of Economic Research.
Series: NBER working paper series -- working paper 6364; Working paper series (National Bureau of Economic Research) -- working paper no. 6364.
Publisher: National Bureau of Economic Research
Published: 1998
Place of publication: Cambridge, MA
Language: eng
Subjects: Democracy -- Economic aspects.; Wages -- Political aspects -- Econometric models.
Description: Controlling for labor productivity, income levels, and other possible determinants, there is a robust and statistically significant association between the extent of democratic rights and wages received by workers. The association exists both across countries and over time within countries. The coefficient estimates suggest that non-negligible wage improvements result from the enhancement of democratic institutions: average wages in a country like Mexico would be expected to increase by 10-30 percent were Mexico to attain a level of democracy comparable to that prevailing in the U.S.
Notes: "January 1998."

JEL no. J30, H40, O15.

Includes bibliographical references (p. 8).

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