another twist on the austrian phillips curve

abstract: it is often claimed that the austrian system of social-partnership rests heavily on a tacit agreement to hold the functional income distribution unchanged (at least if the labour market is broadly in equilibrium). the paper demonstrates that a stabilization of labour's share in national income necessarily implies the consideration of a "wedge" term - namely the ratio between producer and consumer prices - in a wage equation of the phillips curve type and incorporates this idea into anempirical analysis of wage formation in austria. in summary, the empirical findings seem to suggest an interpretation of the austrian phillips-curve as a real product-wage equation.;