Jackson50 on 22 March 2009
| Avinash_Tyagi said: Actually wages even then were sticky Jackson, because of the increasing strength of unions and collecitve bargaining even before the Depression. Yes wages and productivity were gapped, but again, employers don't want to risk inflaming worker discontent, especially not in that period, they would have shed jobs before wages anyways, even Bernanke in 1986 noted that during the Depression employers were unwilling to cut wages, instead opting to lower hours and shed workers, therefore the argument that things would have been better without wage controls is flimsy, since declines in wages would have been met with worker opposition |
Before the Depression, wages really were not sticky. Unions became weaker in the 20s. Union membership decreased markedly until 1923 when it became stagnant for the remainder of the decade. Anyway, I have to get up early tomorrow to return to school.
