Economic Policy Review

What are the Causes of Rising Wage Inequality in the United States?

January 1995Volume 1, Number 1
JEL classification: J31, I21, O33

Authors: John Bound and George Johnson

During the last 15 years—especially in the 1980s—wage inequality rose in the United States. It appears that this can be explained by a secular shift in production functions favoring workers with intellectual rather than manual skills, together with slower growth in the supply of skilled labor than in the previous decade.

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