I think the Marxist Juergen Kucyznski (sp?), later a leading figure in East German social science and history, said the same thing in the 30s in a book titled something like Theory of Wages (Rueff, Hicks, Keynes and J Robinson are all criticized--he raised questions Dunlop would take up two years later,e.g., the relation between real wage and unemployment) ; John Strachey, still a Marxist then, may have argued the same in his book on capitalist crisis from the 30s as well. Perhaps Hayek and co. got the idea from the them or visa versa? That's for the history of economic thought.
Of course unlike these Marxists, the Hayekians are positively recommending real wage cuts; they just don't want to do it by debasing money; they want workers to go straight to their knees. So I wouldn't conclude that Marxism and Austrianism are bedfellows from possible agreement on this issue.
At any rate, if you can turn me to good empirical work that shows that Keynesian policies do not have this effect always or often on any important part of the working class, I would really appreciate it. this didn't happen in the late 60s, early 70s? It certainly seems to me possible that unemployment could be lowered with inflation kept somewhat in control as a result of complementing demand with income policies while in fact the real wages of at least important sections of the working class would be undermined.
It is simply presumed that with a lower unemployment rate as a result of demand stimulus all workers will have greater bargaining power and their money and thus real wages will rise as a result. But will the money wage rise for all workers? If it does, will the real wage keep pace with price rises given an inflationary demand stimulus?
It seems to me that discomfort with what such a statistical study may well reveal has forced Keynesians to insist that their policies be judged solely in terms of their effect on the unemployment rate as long as inflation is kept within bounds. Note how your hero Paul Krugman recommends the most radical inflationary monetary policy for Japan without taking any time to consider what effects it could have on the real income of the toilers. His recommendations do not seem to be fully thought out from the perspective of the working class, though his criticisms of the Bush budget have been quite compelling.
Yours, Rakesh