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Reconciling the Wage Curve and the Phillips Curve

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Author Info
Víctor M. Montuenga-Gómez
José M. Ramos-Parreño

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Abstract

The wage curve is the negative relationship that links wage levels to the unemployment rate. It fits accurately with modern non-competitive labour-market models, but goes against a Phillips-curve modelling, because the latter ties wage growth to the unemployment rate. In this article, we present a comprehensive review of these non-competitive models, highlighting recent contributions that try to eliminate the possible 'gap' that exists between the concepts of the wage curve, on the one hand, and the Phillips curve, on the other. Copyright Blackwell Publishers Ltd, 2005.

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Publisher Info
Article provided by Blackwell Publishing in its journal Journal of Economic Surveys.

Volume (Year): 19 (2005)
Issue (Month): 5 (December)
Pages: 735-765
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Handle: RePEc:bla:jecsur:v:19:y:2005:i:5:p:735-765

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  1. Baltagi, Badi H. & Blien, Uwe & Wolf, Katja, 2007. "Phillips Curve or wage curve? : evidence from West Germany: 1980-2004," IAB Discussion Paper 200714, Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany]. [Downloadable!]
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