An Explanation For The Declining Relationship Between Productivity And Wage Growth

This article provides an analysis that locates the three wedges between productivity growth and wage growth. It is important to understand this problem because economists have traditionally based wage growth in increases in productivity.  They did so because growth in productivity was shared equally between capital and labor for much of the post-war period.  Since this relationship no longer obtains, it is suggested that productivity growth is only related to potential wage growth.