I've read in a few places that wages are affected by inflation and deflation later than other prices, but I can't find any books or articles that explain why this is so or that offer evidence to show that it is so.
Can anyone please help me find something?
Thanks.
Good question. I believe it is actually wages that need to be influenced first due to the non-neutrality of money. The Fed would buy an asset at the desired amount and that would be someone's income which they can spend on goods which then in turn becomes the income of those in the corporation who then spend it on goods etc etc until you get to the bottom rung. So if I theorized this correctly, wages are affected and the increase in the money supply causes a increase of prices because these wage earners are spending it on goods
'Men do not change, they unmask themselves' - Germaine de Stael