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How do you know that real wages are too high?

Manning, Alan ORCID: 0000-0002-7884-3580 (1995) How do you know that real wages are too high? Quarterly Journal of Economics, 110 (4). pp. 1111-1125. ISSN 0033-5533

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Identification Number: 10.2307/2946650


It is a common belief that the existence of involuntary unemployment implies that wages are too high and that wage moderation should be encouraged as a way to keep unemployment down. This paper argues for a reconsideration of this view by showing that it is possible for a binding minimum wage to reduce unemployment or increase employment even if there is involuntary unemployment.

Item Type: Article
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Additional Information: © 1995 The President and Fellows of Harvard College and the Massachusetts Institute of Technology
Divisions: Centre for Economic Performance
Subjects: H Social Sciences > H Social Sciences (General)
H Social Sciences > HB Economic Theory
JEL classification: E - Macroeconomics and Monetary Economics > E2 - Consumption, Saving, Production, Employment, and Investment > E24 - Macroeconomics: Employment; Unemployment; Wages; Intergenerational Income Distribution (includes wage indexation)
Date Deposited: 30 Jun 2008 09:15
Last Modified: 15 May 2024 23:37

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