Sticky wages and the Great Depression: evidence from the United Kingdom

LSE Research Online Documents on Economics from London School of Economics and Political Science, LSE Library

Abstract: How sticky were wages during the Great Depression? Although classic accounts emphasise the importance of nominal rigidity in amplifying deflationary shocks, the evidence is limited. In this paper, I calculate the degree of nominal wage rigidity in the United Kingdom between the wars using new granular data covering millions of wages. I find that nominal wages changed infrequently but that wage cuts were more common than wage rises on average. Nominal wage adjustment fluctuated over time and by state, so that in 1931 amid falling output and prices more than one-third of workers received wage cuts.

JEL-codes: E30 N14 (search for similar items in EconPapers)
Pages: 27 pages
Date: 2023-05-03
New Economics Papers: this item is included in nep-his
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Citations: View citations in EconPapers (1)

Published in European Review of Economic History, 3, May, 2023, 27(2), pp. 196 - 222. ISSN: 1361-4916

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http://eprints.lse.ac.uk/117330/ Open access version. (application/pdf)

Related works:
Journal Article: Sticky wages and the Great Depression: evidence from the United Kingdom (2023)
Working Paper: Sticky Wages and the Great Depression: Evidence from the United Kingdom (2022)
Working Paper: Sticky wages and the Great Depression: evidence from the United Kingdom (2021)
Working Paper: Sticky wages and the Great Depression: Evidence from the United Kingdom (2021)
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Persistent link: https://EconPapers.repec.org/RePEc:ehl:lserod:117330

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