The purpose of this paper is to review trends in real-wage levels in developing countries and to try to identify some of the more important factors that have shaped them. No attempt is made to examine developments in the wage structure. Moreover, the well-known scarcity of wage statistics — and, indeed, of most socio-economic data in developing countries — limits the scope of a review of trends in even the average level of wages. In the first place, by no means all, nor even a majority, of developing countries can be surveyed on the desirable quantitative basis; Table 1 contains data for only thirtyone. As will be seen, however, impressionistic assessments of wage trends that have been made, range rather more widely. Secondly, it is hardly correct to speak even of an assessment of ‘trends’, when the data relate to changes in real wages over a period of no more than eight years, 1956–64. But any attempt to trace developments prior to 1956 is accompanied by a sharp narrowing in the possible country coverage.2
KeywordsReal Wage Wage Increase Wage Earner South American Country Wage Change
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- 2.‘All available evidence indicates that although some workers in underdeveloped economies — usually skilled workers in inflation favoured industries — do increase wage rates at least in full proportion to rises in the price level, most workers are unable to do so.’ [S. P. Schatz, ‘Inflation in Underdeveloped Areas: A Theoretical Analysis’. The American Economic Review (Sep 1957) 576. In support of this proposition, Schatz cites work carried out by Bernstein, Patel and Prest.]Google Scholar
- By no means all writers in the field subscribe to this view. Turner, after a review of wage trends in developing countries, expressed the opinion that ‘wage earners appear — as perhaps in the industrial countries but more so — to have gained rather than lost from inflation.’ [H. A. Turner, Wage Trends, Wage Policies and Collective Bargaining: The Problems for Underdeveloped Countries University of Cambridge, Department of Applied Economics, Occasional Paper No. 6 (1966) 14.]Google Scholar
- 3.E. J. Berg, ‘Major Issues of Wage Policy in Africa’, in Industrial Relations and Economic Development ed. A. M. Ross (1966) 185. The Proceedings of a conference held in Geneva by the International Institute for Labour Studies.Google Scholar