Evidence for the OECD countries show that the “great ratios”, such as the unemployment rate, factor shares, Tobin’s q and the investment-capital ratio, fluctuate significantly on medium-term frequencies of 10-40 years duration. To explain these medium-term fluctuations, we establish a macro-dynamic model where the q-theory of investment is combined with sluggish real-wage adjustment in the labour market. For plausible values of the elasticity of factor substitution real wage sluggishness creates damped internal oscillations in the endogenous variables. Thereby hump-shaped responses to a variety of shocks arise.