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Real wages, productivity and economic growth in the G7, 1960-2002

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  • H. Sonmez Atesoglu
  • John Smithin

Abstract

This paper investigates empirical real wage and productivity dynamics in the G7 countries using annual data for 1960-2002. The findings suggest that the level of labor productivity is positively related to GDP growth in all countries, and real wages are positively related to growth in some of them. The results tend to confirm the 'profit paradox'. This postulates a positive relationship between economic growth and the aggregate profit share, and suggests that the frequent support of business interests for deflationary economic policies is a puzzle.

Suggested Citation

  • H. Sonmez Atesoglu & John Smithin, 2006. "Real wages, productivity and economic growth in the G7, 1960-2002," Review of Political Economy, Taylor & Francis Journals, vol. 18(2), pages 223-233.
    • Handle: RePEc:taf:revpoe:v:18:y:2006:i:2:p:223-233
    DOI: 10.1080/09538250600571478
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    Cited by:

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    2. Freddy, Liew, 2011. "Productivity-wage-growth nexus: an empirical study of Singapore," MPRA Paper 34459, University Library of Munich, Germany.
    3. Amalia Cristescu & Maria Denisa Vasilescu & Larisa Stanila & Madalina Ecaterina Popescu, 2013. "Regional Analysis Of The Real Earnings In Romania," Romanian Journal of Regional Science, Romanian Regional Science Association, vol. 7(2), pages 58-78, DECEMBER.
    4. Thomas L. Hogan & Daniel J. Smith, 2022. "War, money & economy: Inflation and production in the Fed and pre-Fed periods," The Review of Austrian Economics, Springer;Society for the Development of Austrian Economics, vol. 35(1), pages 15-37, March.

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