Wages: the dominant variable behind sticky inflation?

Does the price/earning ratio increase when earnings increase greater than wages? The two competing variables that make up GDP when viewing the economy in terms of income?

During the 1970s real GDP was growing faster than it was during the 80s or 90s, yet the stock market did nothing during that decade.

Of course during the 1970s inflation was a big concern - a major component being wage inflation. Since employment costs are a large percentage of total business costs for many industries, when wages grow strongly, it bites into profits. Since stock market returns are eventually determined by profits, increasing wage costs can affect stock market valuations via reduced margins, and therefore, earnings.

Since wages are currently frozen in developed markets (indeed have grown very weakly over the last decade) due to the easier movement of capital internationally and the lower labour costs in developing countries, can we see this as a sign inflation fears are being overdone?

Commodity price spikes perhaps could be viewed as transitions that come and go, determined primarily by supply and demand, hence are self correcting relatively quickly (especially in agriculture). Yet commodity market returns often grow strongly for large periods of time (generally when real GDP numbers are above average. This could be implied to mean they are primarily driven by increasing demand more than a lack of supply?)

Labour markets are not so efficient at self correcting - as wages are often "sticky" due to the difficulty in reducing wages. Nevertheless, in countries like Spain this stickness is being shattered due to the terrible condition of the national economy in terms of growth and new employment opportunities.

Is this wage stickiness a precursor for inflation? Since free floating currencies should be primarily determined by supply and demand, any inflationary pressure from international capital movements should be self correcting (unless there is strong government intervention)in the medium term. This could leave wages as the dominant factor that determines stickly inflationary pressure in an economy.

Furthermore, note in an inflationary environment it becomes harder politically to reduce wages. As a result, inflation is likely to be constrained only by creating a recession. This was achieved in the early 1980s by increasing interest rates to nearly 20%