Vol. 8 No. 1 (1988)
Jan-Mar / 1988
Published January 1, 1988
How to Cite
Amadeo, Edward J. 1998. “The Different Aspects of Wage Rigidity and Flexibility in Keynesian Analysis”. Brazilian Journal of Political Economy 8 (1):85-92. https://doi.org/10.1590/0101-31571988-0082.
The different aspects of wage rigidity and flexibility in Keynesian analysis
Abstract
The paper analyses different aspects of the role of wages in Keynesian Economics.
It argues that a reduction in money wages – a policy prescription to fight unemployment
usually found in orthodox analysis – may have a negative effect on the level of activity.
Also, it argues that the conventional view of Keynesian macroeconomics (based on the rigidity
of wages) misinterprets Keynes’s own views in the General Theory. ln the book Keynes
points out that wide fluctuations of. wages are not desirable since they would lend instability
to the economic system.
JEL Classification: B22; J30; E12.
Keywords: Wage rigidity wages history of economic thought Keynesianism