The Wage Spread

A comprehensive examination of wage spreads as the main factor in growing income inequality in the United States over the last 35 years.

4,428 words () | 16 sources | APA | 2009 Germany

Paper Summary:

The paper explores the growing gap between the lowest and highest wages in the United States since the 1970s. In the paper's first chapter, the writer presents the development of wage trends in the U.S. according to various dimensions. In the paper's second chapter, the writer offers possible explanations for the process by exploring the factors that affect low, middle, and high-wage workers differently. In the conclusion, the writer shows the necessity of continuously updating the research for this will enable the state policymakers to improve wage gaps and level income distribution in the country. The paper includes a list of definitions, graphs and tables.

Outline:
Definitions
Introduction
Wage Spread
Explaining Wage Spreads
Conclusion

From the Paper:

"A rising tide lifts all boats. In the speech of the US President John F. Kennedy, the phrase meant that economic growth lifts all problems - both social and political. During the next decades, few would argue that when the economy is growing, all are satisfied. But in the 21st century, the validity of this doctrine is questioned.
"In 2007, American economy grew up by 4.8%1. Such a speed is much lower than those of the world growth leaders of the last decade, China and India, and those of the post Soviet block states, lower than in the African countries that started growing recently. And still, America is growing almost twice as fast as most of other developed countries2. At the same time, according to the social polls, most Americans think that their economic position is worsening. And this is an objective, not subjective reality."

Sample of Sources Used:

Bernstein, Jared and Mishel, Lawrence (2001) Seven Reasons for Scepticism about theTechnology Story of U.S. Wage Inequality, in Berg I. And Kallenber A.L. eds. Sourcebook ofLabor Markets: Evolving Structures and Processes, Kluwer Academic / Plenum Publishers, New York.
Bernstein, Jared, McNichol, Elizabeth, and Lyons, Karen (2006) Pulling Apart: A State-by-State Analysis of Income Trends, Center on Budget and Policy Priorities.
Burtless, Gary (1999) Effects of Growing Wage Disparities and Changing Family Composition on the U.S. Income Distribution, in European Economic Review, Vol. 43, No. 4-6 (April), 853-65.
DiNardo, John; Fortin, Nicole M. And Lemieux, Thomas (1996) Labour Market Institutions AndThe Distribution Of Wages, 1973-1992: A Semiparametric Approach, in Econometrica, Vol. 64,No. 5, 1001-1044.
Goldin, Claudia and Katz, Lawrence F. (2007) Long-Run Changes in the Wage Structure: Narrowing, Widening, Polarizing in Brooking Papers on Economic Activity, 2:2007.