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The Struggle Over the Real Wage In the Monetary Production Economy

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  • Hernando Matallana

Abstract

Keynes contents in General Theory that the monetary market logic of the aggregate real wage in the monetary production economy conveys: (i) the determination of the average real wage rate, the level of employment, and the possibility of involuntary unemployment through the interaction of the monetary markets and the goods markets; and (ii) the determination of the money wage rate through the bargains of the firms and the workers as a market-theoretical stability condition of the economic system. Accordingly, (iii) the money wage claims of labour (in conformity with changes of the average labour productivity) do not alter the distribution of income between capital and labour; and (iv) the struggle about the money wages by different groups of workers is actually a zerosum game over the distribution of the aggregate real wage between the different fractions of the working class. The paper discusses Keynes´s contention in the context of the monetary-keynesian theory of the endogenous-money monetary production economy.

Suggested Citation

  • Hernando Matallana, 2009. "The Struggle Over the Real Wage In the Monetary Production Economy," Documentos CEDE 5271, Universidad de los Andes, Facultad de Economía, CEDE.
    • Handle: RePEc:col:000089:005271
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    File URL: https://repositorio.uniandes.edu.co/bitstream/handle/1992/8100/dcede2009-02.pdf
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    References listed on IDEAS

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    1. Warren J. Samuels, 1992. "An Essay on the Nature and Significance of the Normative Nature of Economics," Palgrave Macmillan Books, in: Essays on the Methodology and Discourse of Economics, chapter 5, pages 85-91, Palgrave Macmillan.
    2. Hernando Matallana, 2008. "A Short Guide to Long-Run Time-Phased Systems of Production," Documentos CEDE 5101, Universidad de los Andes, Facultad de Economía, CEDE.
    3. L. Randall Wray, 1998. "Modern Money," Economics Working Paper Archive wp_252, Levy Economics Institute.
    4. Frank Hahn & Robert Solow, 1997. "A Critical Essay on Modern Macroeconomic Theory," MIT Press Books, The MIT Press, edition 1, volume 1, number 026258154x, December.
    5. L. Randall Wray, 1998. "Understanding Modern Money," Books, Edward Elgar Publishing, number 1668.
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    Cited by:

    1. Hernando Matallana, 2011. "Mercantilismo, acumulación de capital y desarrollo económico en la economía monetaria de producción (nacional)," Revista Cuadernos de Economia, Universidad Nacional de Colombia, FCE, CID, December.

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    More about this item

    Keywords

    income distribution; monetary production economy; monetarykeynesianism; real aggregate wage; wage labour; wage differentials;
    All these keywords.

    JEL classification:

    • B22 - Schools of Economic Thought and Methodology - - History of Economic Thought since 1925 - - - Macroeconomics
    • E12 - Macroeconomics and Monetary Economics - - General Aggregative Models - - - Keynes; Keynesian; Post-Keynesian; Modern Monetary Theory
    • E24 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Employment; Unemployment; Wages; Intergenerational Income Distribution; Aggregate Human Capital; Aggregate Labor Productivity
    • E25 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Aggregate Factor Income Distribution
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials

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