The macroeconomic movements of real wage rates and employment: further evidence

ABSTRACT

Supported by the empirical results of the frequency table approach applied to a time series of data related to average weekly wages and employment in the United Kingdom, the United States, and Canada, this paper contends that across an entire economy, real wage rates behave countercyclically in the short term, as John Maynard Keynes predicted in his general theory.

KEYWORDS:

• Real wage rates
• employment
• countercyclicality
• Keynes
• general theory

JEL CLASSIFICATION:

• E12
• E32

Disclosure statement

No potential conflict of interest was reported by the authors.

Notes

¹ Full-time employees are persons, based on the LFS, who work in main jobs for more than 30 hours per week; part-time employees work in main jobs for less than 30 hours per week. These definitions are suitable for employees in the US and UK.