Historical Literature Of Studying The Cyclical Behavior Of Wages

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Literature Review
For this aspect, it should review historical literature of studying the cyclical behaviour of wages in detail compare with last part and it is very useful to make a contribution for latter aspect in this paper.
The literature review begins with Keynes (1936) believed that the patterns of real wages and employments over the business cycle shows the movements of a fixed and short run labour demand schedule, which means he agreed with the opinions of classical economics. It implied prediction of countercyclical wage movements through a cycle of empirical testing and new theorizing until today. While Dunlop (1938) and Tarshis (1939) are found and interpret some evidences to supporting non-Keynesian theory and they propose that procyclical correlation of real wages over business. They states that countercyclical movements of real wages is not perfect conclusion and the measurement is not complicated and accurate. This a first time someone studied procyclical theory and then economist start to use “procyclical” as a glossary to describe this economic prediction while other glossary also appear, such as “countercyclical”, “weakly procyclical” and “noncyclical”. Many economists also make numerous studies against this economic prediction and proposed many evidences of procyclical correlation of real wages. Bodkin (1969) found that the acyclic data of real wages could not be rejected and it is an interesting result presented by Bodkin. He found that the

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