Re: rising real wages in a recession

[Stephen E Philion <philion@xxxxxxxxxx>]

What make one of shrub's announcement that to 'help the  economy' he would
urge more spending cuts next year? Something about that sounded eerily
Hooverian to me, not of the J Edgar brand either...

Steve

On Fri, 7 Sep 2001, Jim Devine wrote:

> Doug wrote: >real wage growth has actually picked up for U.S. workers -
> it's approaching 2% year-on-year in private services. Service prices are
> rising more slowly than wages, putting a squeeze on profits. <
>
> oh, yeah, I forgot: is it possible that the economy is sliding upward along
> a downward-sloping labor demand (= marginal product of labor) curve (with
> the real wage on the vertical axis & employment on the horizontal), so that
> as wages rise (due to the greed or shortsightedness of workers) we see
> employment falling?
>
> as my students say: "yeah, right."
>
> Jim Devine jdevine@xxxxxxx &  http://bellarmine.lmu.edu/~jdevine
>
>