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Changes in Earnings Inequality: The Role of Demand Shifts

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Author Info
Johnson, George E
Abstract

That the relative demand for labor in the upper segment of the skill distribution has been shifting is a widely accepted 'stylized fact' in the literature on the increase in earnings inequality that has occurred since the late 1970s. Explanations of the causes of the relative demand shifts range from effects of increased integration of the world economy to skill-based technological change (reflecting, in part, the computerization of production processes). However, relative demand for skilled labor has been increasing fairly steadily since 1940, a fact having implications about the causes of both the demand shifts and recent increases in inequality. Copyright 1997 by American Economic Association.

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Article provided by American Economic Association in its journal Journal of Economic Perspectives.

Volume (Year): 11 (1997)
Issue (Month): 2 (Spring)
Pages: 41-54
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Handle: RePEc:aea:jecper:v:11:y:1997:i:2:p:41-54

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Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
  1. Levy, Frank & Murnane, Richard J, 1992. "U.S. Earnings Levels and Earnings Inequality: A Review of Recent Trends and Proposed Explanations," Journal of Economic Literature, American Economic Association, vol. 30(3), pages 1333-81, September. [Downloadable!] (restricted)
  2. Claudia Goldin & Lawrence F. Katz, 1996. "The Origins of Technology-Skill Complementarity," NBER Working Papers 5657, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
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  3. Griliches, Zvi, 1969. "Capital-Skill Complementarity," The Review of Economics and Statistics, MIT Press, vol. 51(4), pages 465-68, November. [Downloadable!] (restricted)
  4. S Machin & A Ryan & J Van Reenan, 1996. "Technology and Changes in Skill Structure: Evidence from an International Panel of Industries," CEP Discussion Papers 0297, Centre for Economic Performance, LSE.
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  5. Murphy, Kevin M & Welch, Finis, 1992. "The Structure of Wages," The Quarterly Journal of Economics, MIT Press, vol. 107(1), pages 285-326, February. [Downloadable!] (restricted)
  6. Richardson, J David, 1995. "Income Inequality and Trade: How to Think, What to Conclude," Journal of Economic Perspectives, American Economic Association, vol. 9(3), pages 33-55, Summer. [Downloadable!] (restricted)
  7. John E. DiNardo & Jorn-Steffen Pischke, 1996. "The Returns to Computer Use Revisited: Have Pencils Changed the Wage Structure Too?," NBER Working Papers 5606, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
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  8. Borjas, George J & Ramey, Valerie A, 1994. "Time-Series Evidence on the," American Economic Review, American Economic Association, vol. 84(2), pages 10-16, May. [Downloadable!] (restricted)
  9. Rosen, Sherwin, 1981. "The Economics of Superstars," American Economic Review, American Economic Association, vol. 71(5), pages 845-58, December. [Downloadable!] (restricted)
  10. Goldin, Claudia & Margo, Robert A, 1992. "The Great Compression: The Wage Structure in the United States at Mid-century," The Quarterly Journal of Economics, MIT Press, vol. 107(1), pages 1-34, February. [Downloadable!] (restricted)
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  11. Welch, F, 1970. "Education in Production," Journal of Political Economy, University of Chicago Press, vol. 78(1), pages 35-59, Jan.-Feb.. [Downloadable!] (restricted)
  12. David A. Brauer & Susan Hickok, 1995. "Explaining the growing inequality in wages across skill levels," Economic Policy Review, Federal Reserve Bank of New York, issue Jan, pages 61-75. [Downloadable!]
  13. Freeman, Richard B, 1995. "Are Your Wages Set in Beijing?," Journal of Economic Perspectives, American Economic Association, vol. 9(3), pages 15-32, Summer. [Downloadable!] (restricted)
  14. George J. Borjas & Richard B. Freeman & Lawrence F. Katz, 1996. "Searching for the Effect of Immigration on the Labor Market," NBER Working Papers 5454, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
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  15. Wood, Adrian, 1995. "How Trade Hurt Unskilled Workers," Journal of Economic Perspectives, American Economic Association, vol. 9(3), pages 57-80, Summer. [Downloadable!] (restricted)
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