Legislative profits and the rate of change of money wages: A comment

Conclusion

Gärtner's study is open to objection on a number of counts. His empirical results fail to entirely support the hypotheses derived from his theoretical model, and his test is weakened by the use of dummies to capture ‘political’ influences on wage movements. Taking account of factors ignored by Gärtner's theoretical account, we are able to undermine his explanation, providing what may be either a partial or complete alternative. Whilst politically associated ‘shift’ and ‘cycle’ factors may be at work, they may, as we have tried to show, arise in an entirely different manner from that originally postulated. A comparison of the two approaches is given below.

Which explanation prevails is, of course, a matter which can only be resolved by further empirical research.