This paper assesses the degree of homogeneity of macroeconomic frameworks of European countries by testing the presence or absence of a mechanism for convergence of sacrifice ratios within different groups of European countries. For this, a two-step statistical procedure is used. The first step estimates the trajectory of the sacrifice ratios of seventeen European countries using rolling regressions. The second step then tests the presence of a trend to reduce the dispersion of the sacrifice ratios between these countries. The tests conclude in favor of the presence of a phenomenon of convergence of sacrifice ratios between the late '80s and the end of the sample within the two groups of countries: European countries characterized by decentralized wage bargaining and countries belonging to the core group identified by Bayoumi-Eichengreen. Other groups of European countries are by cons show a lack of convergence or divergence of sacrifice ratios.
|Number of pages||17|
|Journal||Economies et Sociétés|
|Publication status||Published - 2010|
- sacrifice ratios