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Relative Wage Variability in the United States, 1860-1983

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  • Allen, Steven G

Abstract

This study examines relative wage variability across industries between 1860 and 1983. The variance across industries in wage growth was at least four times larger before 1948 than afterward. Except for smaller year-to-year variability in output growth across industries after 1948, the macroeconomic factors examined cannot account for this increased rigidity of relative wages. Increases in average establishment size and improved communication of wage trends are probably partially responsible for the observed increase in relative wage rigidity. No single macroeconomic model was consistent with the year-to-year fluctuations in relative wage rigidity in every historical period examined. Copyright 1987 by MIT Press.

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Article provided by MIT Press in its journal Review of Economics & Statistics.

Volume (Year): 69 (1987)
Issue (Month): 4 (November)
Pages: 617-26

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Handle: RePEc:tpr:restat:v:69:y:1987:i:4:p:617-26

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  1. Zvi Hercowitz, 1980. "Money and the Dispersion of Relative Prices," NBER Working Papers 0431, National Bureau of Economic Research, Inc.
  2. Hamermesh, Daniel S, 1986. "Inflation and Labour Market Adjustment," Economica, London School of Economics and Political Science, London School of Economics and Political Science, vol. 53(29), pages 63-73, February.
  3. Stanley Fischer, 1981. "Relative Shocks, Relative Price Variability, and Inflation," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, Economic Studies Program, The Brookings Institution, vol. 12(2), pages 381-442.
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