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Wage Growth, Inflation and the Labor Share
Abstract: The recent pattern of nominal wage growth has been a puzzle to economists, researchers and policymakers because it lies well below the trend wage growth predicted by inflation and productivity growth. We show that the difference can be reconciled by accounting for the labor share of output, which has been on a declining trend for the past 15 years.
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Provider: Federal Reserve Bank of Chicago
Part of Series: Chicago Fed Letter
Publication Date: 2015
Order Number: 349