IDEAS home Printed from https://ideas.repec.org/
MyIDEAS: Login to save this paper or follow this series

Real wages, inflation and unemployment

  • Palle S. Andersen
Registered author(s):

    This paper summarises the main features of an expectations-augmented Phillips curve with accompanying mark-up price equations. The empirical counterparts for six countries are presented. Even though preliminary, the results are relatively satisfactory in terms of statistical fit and a priori expectations with respect to the sign and size of the parameters. However, in periods when both inflation and unemployment have increased far above historical trends, it is somewhat unsatisfactory to assume that the level of unemployment is exogenous and independent of the inflation process. Moreover, considering the simultaneous changes in relative prices and real wages, there would seem to be some merit in incorporating these variables – directly and indirectly – in the wage formation process.

    If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.

    File URL: http://www.bis.org/publ/work9.pdf
    File Function: Full PDF document
    Download Restriction: no

    File URL: http://www.bis.org/publ/work9.htm
    Download Restriction: no

    Paper provided by Bank for International Settlements in its series BIS Working Papers with number 9.

    as
    in new window

    Length: 47 pages
    Date of creation: Jul 1984
    Date of revision:
    Handle: RePEc:bis:biswps:9
    Contact details of provider: Postal: Centralbahnplatz 2, CH - 4002 Basel
    Phone: (41) 61 - 280 80 80
    Fax: (41) 61 - 280 91 00
    Web page: http://www.bis.org/
    Email:


    More information through EDIRC

    References listed on IDEAS
    Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:

    as in new window
    1. Pitchford, J. D., 1981. "A consistent model of the expectations augmented Phillips curve and inflation," Journal of Macroeconomics, Elsevier, vol. 3(4), pages 489-499.
    2. William H. Branson & Julio J. Rotemberg, 1981. "International adjustment with wage rigidity," NBER Chapters, in: International Seminar on Macroeconomics, pages 309-332 National Bureau of Economic Research, Inc.
    3. George L. Perry, 1983. "What Have We Learned about Disinflation," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 14(2), pages 587-602.
    4. Ormerod, Paul, 1982. "Rational and Non-Rational Expectations of Inflation in Wage Equations for the United Kingdom," Economica, London School of Economics and Political Science, vol. 49(196), pages 375-87, November.
    5. Malinvaud, Edmond, 1982. "Wages and Unemployment," Economic Journal, Royal Economic Society, vol. 92(365), pages 1-12, March.
    6. Agarwala, R, et al, 1972. "A Neo-classical Approach to the Determination of Prices and Wages," Economica, London School of Economics and Political Science, vol. 39(155), pages 250-63, August.
    7. Taylor, Jim & Cunningham, Jim, 1982. "Profit, Relative Prices and Unemployment: A Comment," Economic Journal, Royal Economic Society, vol. 92(365), pages 161-69, March.
    8. Jeffrey D. Sachs, 1983. "Real Wages and Unemployment in the OECD Countries," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 14(1), pages 255-304.
    9. Grubb, David B. & Jackman, Richard & Layard, Richard, 1983. "Wage rigidity and unemployment in OECD countries," European Economic Review, Elsevier, vol. 21(1-2), pages 11-39.
    10. Morley, R, 1979. "Profit, Relative Prices and Unemployment," Economic Journal, Royal Economic Society, vol. 89(355), pages 582-600, September.
    11. Hickman, Bert G & Klein, Lawrence R, 1984. "Wage-Price Behavior in the National Models of Project LINK," American Economic Review, American Economic Association, vol. 74(2), pages 150-54, May.
    12. Rosen, Harvey S & Quandt, Richard E, 1978. "Estimation of a Disequilibrium Aggregate Labor Market," The Review of Economics and Statistics, MIT Press, vol. 60(3), pages 371-79, August.
    13. McCallum, B T, 1974. "Wage Rate Changes and the Excess Demand for Labour: An Alternative Formulation," Economica, London School of Economics and Political Science, vol. 41(163), pages 269-77, August.
    14. Morley, R, 1982. "Profit, Relative Prices and Unemployment: A Reply," Economic Journal, Royal Economic Society, vol. 92(365), pages 170-73, March.
    15. Jeffrey D. Sachs, 1979. "Wages, Profits, and Macroeconomic Adjustment: A Comparative Study," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 10(2), pages 269-332.
    16. McCallum, Bennett T, 1976. "Rational Expectations and the Natural Rate Hypothesis: Some Consistent Estimates," Econometrica, Econometric Society, vol. 44(1), pages 43-52, January.
    17. Wadhwani, Sushil B, 1985. "Wage Inflation in the United Kingdom," Economica, London School of Economics and Political Science, vol. 52(206), pages 195-207, May.
    18. Roth, Jürgen, 1982. "Mehr Beschäftigung durch Reallohnzurückhaltung: Zum Streit zwischen kosten- und nachfrageorientierter Lohnpolitik," Kiel Discussion Papers 85, Kiel Institute for the World Economy (IfW).
    19. Kahn, George A, 1984. "International Differences in Wage Behavior: Real, Nominal, or Exaggerated?," American Economic Review, American Economic Association, vol. 74(2), pages 155-59, May.
    Full references (including those not matched with items on IDEAS)

    This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

    When requesting a correction, please mention this item's handle: RePEc:bis:biswps:9. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Christian Beslmeisl)

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If references are entirely missing, you can add them using this form.

    If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    This information is provided to you by IDEAS at the Research Division of the Federal Reserve Bank of St. Louis using RePEc data.