Employment, wages and prices: How did firms adjust during the economic and financial crisis? Evidence from a survey of Luxembourg firms

This report presents new insights on the nature, size and persistence of various shocks (demand, credit, costs etc.) experienced by Luxembourg firms during the initial years of the economic crisis in 2008-09 and subsequently in the period 2010-13, as well as on how firms adjusted to these shocks in terms of employment, wages and prices. It discusses the extent to which institutional changes in the Luxembourg labour market through various public support measures helped alleviate the effects of the economic crisis.

Keywords: Economic and financial crisis, reaction to shocks, wage and price rigidity,

firms, survey, WDN

JEL Codes: C25, D22