In 1938 Dunlop challenged the assertion in the General Theory that wages moved countercyclically. The resulting debate on the cyclical movement of wages deserves study as an episode in the history of economic thought. This is done in chapter 2 which reviews the theoretical issues and chapter 3 which reviews the empirical work. To understand this history requires some analysis of the meaning and significance of the debate. At one level the debate can be interpreted as the search for a 'stylised fact'. This is apparently an empirical question and part of the thesis will be concerned to use data for various countries, time-periods, cycle phases, and industries to examine whether there is any systematic cyclical pattern in wage movements. The conclusion of the empirical analysis is that there is no such empirical regularity. At a second level the debate was theoretical. The empirical observation that wages moved procyc1ica1ly was thought to falsify a prevailing theory. What is interesting about this debate is the light it sheds on the response of economists to apparent falsification. A third level of the debate is the issue of inference. Keynes tended to treat theory as prior, attacking 'pseudo natural science procedures'. Keynes was not opposed in principle to statistical work informing theory: although in practice he did not attempt the empirical investigation into cyclical wages for which he called. Thus from a different methodological standpoint Burns and Mitchell criticise the theorist who 'often stops before his work is finished'. Current econometrics would emphasise the need for identifying assumptions before estimates could be used to test hypotheses. In this framework, the implications for theory of any reduced form regularity would be ambiguous in the absence on non-data based identifying assumptions. This thesis uses the history of the debate and the empirical analysis to illustrate these themes of observation, theory and inference.

Writers on the business cycle often emphasize that non-linear models are needed to account for certain of its features. Thus it is often said that either the asymmetry of the duration of business cycle expansions and contractions or the variability of these quantities demand a non-linear model. Such comments are rarely made precise however and mostly consist of references to such assertions from the past. Thus the asymmetry in the cycle is mostly accompanied by references to Keynes (1936) and Burns and Mitchell (1946). But these authors were looking at what we call today the classical cycle i.e. movements in the level of GDP, and so the fact that there are long expansions and short contractions can arise simply due to the presence of long-run growth in the economy, and it is not obvious that it has much to do with non-linearity. This thesis aims to introduce various statistics that can be used to characterise the specific shape of the non-linearity observed in macroeconomic time series. Chapter 2 introduces a range of statistics and presents the dating algorithm used in this thesis, which is based on the BBQ algorithm of Harding and Pagan (2002). Chapter 3 tests the adequacy of linear models versus the SETAR model of van Dijk and Franses(2003) and the bounceback model of Kim, Morley and Piger (2005) in capturing observed non-linear features of the data. Chapter 4 extends this work by examining the three state Markov model of Hamilton (1989), again using the ??bounce-back?? model of Kim C., Morley, J. and J. Piger, (2005), and the more complicated ??tension?? model of DeJong, D., Dharmarajan, H., Liesenfeld, R. and Richard, J., (2005). Chapter 4 also extends Chapter 3 by estimating the above mentioned models on US GDP, Australian non-farm GDP, US investment and Australian dwellings investment. They are then simulated in order to gauge the cycle properties. Chapter 5 analyses the business cycle implications of two related multivariate dynamic factor models presented in papers by Kim and Piger (2001, 2002). Finally Chapter 6 concludes.

Proefschrift Universiteit van Amsterdam. / Met index, lit. opg. - Met samenvatting in het Nederlands.

Thesis (Ph.D.)--University of California, Los Angeles, 2003. / Includes bibliographical references (leaves 229-232).

Thesis (Ph. D.)--Ohio State University, 1994. / Includes bibliographical references (leaves 57-69). Available online via OhioLINK's ETD Center.

Thesis (Ph. D.)--Princeton University, 1938. / Cover title. "Reprinted from the Quarterly journal of economics, vol. LIII, no. 3, May, 1939."

Diss.--Handels-Hochschule, St. Gallen. / Bibliography: p. xvii-xxiv.

Diss.--Basel. / eContent provider-neutral record in process. Description based on print version record. Bibliography: p. v-vii.

Thesis--London. / "Selected bibliography": p. 170-172.

Thesis (Ph. D.)--University of Pennsylvania, 1926. / Bibliography: p. 72.