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Real Wages and Employment
Keynes, Monetarism and the Labour Market
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In this book Andres Drobny examines the foundations of the Monetarist counter-revolution against Keynesian economics. He distinguishes between the two approaches, concentrating on their respective views of the importance of relative prices in business cycles. As he shows, the core of the Monetarist critique centres on the natural rate hypothesis and the associated view that periodic fluctuations in employment arise as a result of counter-cyclical movements in real wages. He argues that the success of Monetarism stems from the fact that prominent Keynesian analyses of business cycles accept the view that real wage levels in the main determine aggregate employment levels. He proposes an alternative disequilibrium model of the demand for labour which produces Keynesian-type conclusions while simultaneously being immune to the Monetarist critique. Drobny derives models of the demand for labour based on the Keynesian and Monetarist approaches which produce conflicting propositions concerning the relationship between real wages, output and employment. These propositions are subjected to a battery of tests for Granger causality using post-war data. His comparison reveals many of the implicit assumptions underlying both the Monetarist and orthodox Keynesian theories.
Routledge; October 1988
256 pages; ISBN 9780203168561
Read online, or download in secure PDF format or MobiPocket
256 pages; ISBN 9780203168561
Read online, or download in secure PDF format or MobiPocket
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9781134988020
9781134988013
9780415003865
9780203168561
0203168569