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Social and Behavioral Sciences Commons

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Economics

Economics Department Working Paper Series

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2010

Efficiency wage

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Full-Text Articles in Social and Behavioral Sciences

Labor Heterogeneity, Inequality And Institutional Change, Peter Skott Sep 2010

Labor Heterogeneity, Inequality And Institutional Change, Peter Skott

Economics Department Working Paper Series

US earnings inequality has increased dramatically since the 1970s, and the prospect of a reversal depends on what caused the trend. The standard explanation emphasizes skill-biased technical change. This paper briefly considers some aggregation issues and then proceeds to outline two alternative perspectives .power biased technical change and the effects of induced mismatch in the labor market .and their implications.