Real Wages and Unemployment in Britain during the 1930s

This paper explains shifts in the level of economic activity in Britain in the interwar period, particularly from 1928 to 1937, and relates these to movements in the real wage. The authors' general thesis is that the real wage follows a path that is perfectly consistent with the recession of the early 1930s being instigated, in the main, by demand shocks. Supply-side factors are only of minor significance. Copyright 1989 by Royal Economic Society.