TY  - JOUR
AU  - Summers,Lawrence H.
TI  - Relative Wages, Efficiency Wages, and Keynesian Unemployment
JF  - National Bureau of Economic Research Working Paper Series
VL  - No. 2590
PY  - 1989
Y2  - October 1989
UR  - http://www.nber.org/papers/w2590
L1  - http://www.nber.org/papers/w2590.pdf
N1  - Author contact info:
Lawrence H. Summers
Harvard Kennedy School of Government
79 JFK Street
Cambridge, MA 02138
Tel: 617/495-9322
Fax: 617/495-0436
E-Mail: lhs@harvard.edu
AB  - While modern economic theorists have produced a variety of explanations for the failure of wages to fall in the face of unemployment, Keynes emphasis on relative wages has not been reflected in most contemporary discussions. This short paper suggests that relative wage theories in which workers' productivity depends primarily on their relative wage provide the best available apparatus for understanding actual unemployment and its fluctuations. Such theories are very closely related to the efficiency wage theories that have received widespread attention in recent years.
ER  -