Substitution and the skill premium

Grant Type: academic

Grant Year: 2015

Grant Amount: $25,000

Grant description:

Economic inequality research has long focused on household income and wealth or individual earnings. Recent evidence suggests that the share of total income is increasingly diverting from labor to capitol. Yet the reasons for the declining labor share of income are not yet clear. This project examines several potential causes for this decline, particularly looking at differences in skills among workers and how those skill differences affect firms’ decisions about production.

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