Deregulation and wages in trucking: A time series phenomenon -- A time series approach

We approach measuring the wage effect of trucking deregulation from a new perspective using time series estimation techniques. The trucking wage is modeled as a function of the manufacturing wage and the relationship between these series is measured over time. We find that the wage premium of trucking over manufacturing is deterministic over time with two structural breaks in May 1980 and June 1984. This suggests that deregulation's effect on the trucking wage was mainly felt between 1980 and 1984. Using the relationship between the trucking wage and manufacturing wage before deregulation, we find that the initial effect of deregulation was to decrease wages 6.99%. This wage effect increased at a decreasing rate over time and by 1996 the cumulative effect was 12.43%.