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How do you know that real wages are too high?

Manning, Alan (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)
Sets: Collections > Economists Online
Research centres and groups > Centre for Economic Performance (CEP)
Departments > Economics
Date Deposited: 30 Jun 2008 09:15
Last Modified: 20 Nov 2019 06:31

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