ABSTRACT
Introduction In elementary Keynesian theory, the money wage level is a relatively neglected variable. For quite different reasons it was also neglected for the most part by neo-classical writers. This is due to the fact that wages in neo-classical theory nearly always meant real wages, and the absolute level of money wages was not regarded as central to any problem of wage theory. This view was little influenced by the obvious growth in the importance of bargaining for money wages, as trade unions increased their size and power, for the orthodox neo-classic would have denied the ability of trade unions to affect the level of real wages although not to affect the level of money wages in the short period. Thus while the treatment of real wages received considerable attention largely within the framework of the marginal productivity approach to distribution the determinants of the money wage level were in the main either neglected or taken for granted. The situation was not radically altered by the advent of a new Keynesian orthodoxy which emphasized the determination of real output and employment. In short period Keynesian analysis, the assumption of a given money wage was not altogether unrealistic and from a,* analytical point of view extremely convenient, so that initially the switch from neo-classical to Keynesian orthodoxy did little to encourage extensive reconsideration of the determinants of money wages.
