This analysis examines the link between productivity and wages in Argentine manufacturing, suggesting significant implications for the economy.
Is there a link between labour productivity and wages in Argentine manufacturing? Does it vary between different technical and productive categories and wage levels? What factors affect this relationship, in the light of the country’s premature deindustrialization? Employing a firm-level dataset for 2010–2021 from the National Survey on Employment and Innovation Dynamics (ENDEI) database, we estimate the link between productivity and wages across the conditional wage distribution among manufacturing firms. Our results confirm a positive but extremely low wage-productivity pass-through that differs between sectors according to their technical and productive capabilities and is robust to alternative estimation strategies. These asymmetrical firm-level distribution patterns carry substantial implications for the macroeconomic trajectory of the country, as they are perpetuating the underdevelopment trap.
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Caribbean et al. (2025) studied this question.
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