Post Keynesian economics: Determination of wage and an empirical analysis for Turkey

Though the subject of wage determination is among the most important subjects of macroeconomics in fact, it also has great importance to determine the direction of distribution of income. In Post- Keynesian economy which has a heterodox point of view, an approach against general economical trends concerning wage setters has been demonstrated. At the same time, Post- Keynesians aiming to complete the missing points of Keynes state that at the struggle between employee and employer on distribution of income, the wage determination is resulted against the employee. This situation creates a struggle between two sides. In this study, in the period between1980-2011, an econometric analysis was applied on average real wage determination in accordance with Post- Keynesian approach for the general Turkish economy. The effect of unemployment, strike, productivity and collective labour agreement on average real wage were tested in this study, respectively. According to the results, the positive effect of employment, productivity and collective labour agreement numbers symbolising negotiating power are consistent with Post- Keynesian approach on wage determination. Nonetheless, in respect of the studied period, the result that strikes have a positive effect on wage determination can not be obtained.