Sticky wages and the Great Depression: evidence from the United Kingdom

Lennard, Jason ORCID: 0000-0002-6700-8969 (2021) Sticky wages and the Great Depression: evidence from the United Kingdom. Economic History Working Papers (332). Department of Economic History, London School of Economics and Political Science, London, UK.

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Abstract

How sticky were wages during the Great Depression? Although classic accounts emphasize the importance of nominal rigidity in amplifying deflationary shocks, the evidence is limited. In this paper, I calculate the degree of nominal wage rigidity in the United Kingdom between the wars using new granular data covering millions of wages. I find that nominal wages were more flexible downwards than in most modern economies, but that the frequency and magnitude of wage cuts were too low to fully offset deflation

Item Type:	Monograph (Working Paper)
Official URL:	https://www.lse.ac.uk/Economic-History/Working-Pap...
Additional Information:	© 2021 The Author
Divisions:	Economic History
Subjects:	H Social Sciences > HC Economic History and Conditions H Social Sciences > HD Industries. Land use. Labor
JEL classification:	E - Macroeconomics and Monetary Economics > E3 - Prices, Business Fluctuations, and Cycles > E30 - General N - Economic History > N1 - Macroeconomics and Monetary Economics; Growth and Fluctuations > N14 - Europe: 1913-
Date Deposited:	14 Oct 2021 07:15
Last Modified:	11 Sep 2025 05:02
URI:	http://eprints.lse.ac.uk/id/eprint/112428

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