Despite a low unemployment rate, wage growth in the U.S. was negligible during the 2013-2015 period. Conventional linear models of the relationship between wages and unemployment, the so- called wage Phillips curve (WPC), and previous models of the WPC that rely on regime-switching driven only...

Using threshold regression analysis, this paper studies how the relationship between unemployment and output, known as Okun's law, varies across business cycles measures. At the U.S. aggregate level, the results indicate the presence of strong asymmetries in the relationship characterized by...