How does wage polarization affect productivity? The case of Spanish regions

Abstract

The effect of wage polarization on total factor productivity (TFP) in the Spanish regions between 2004 and 2012 is analysed using dynamic panel estimates. The main finding of this research is that there seems to be some evidence that polarization can affect productivity negatively. Although the specification of the models seems to be correct, the time period studied is brief, so these results should be interpreted with caution.