Well, I understand and agree with behavior of the Phillip's Curve at low inflation. That's all fine.
But I don't understand his point at the end about average wages in the Depression. Are overtime wages "fake" wages or something? Who cares that when you take out overtime wages don't drop as much. How does that tell you that wages actually are stickier than the numbers imply.
Wage earners getting overtime sure view those as actual wages, and firms paying over time sure view those as actual labor costs.
[btw - often, but not always, when I say "I don't understand" something in the title, it actually means "I think I understand and I think you're wrong, but I'm not confident enough and/or too polite to come out and say that". I'm not really as humble as the title suggests.]
Friday Night Music: When I’m 64
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