Cross-Country Inequality Trends
keywords: international comparison, demand and supply
I review the two most popular explanations for the differential trends in wage inequality in US/UK and Europe: that relative supply of skills increased faster in Europe, and that European labour market institutions prevented inequality from increasing. Although these explanations go some way towards accounting for the differential cross-country inequality trends, it also appears that relative demand for skills increased differentially across countries. I develop a simple theory where labour market institutions creating wage compression in Europe also encourage more investment in technologies increasing the productivity of less-skilled workers, implying less skill-biased technical change in Europe than the US. Copyright Royal Economic Society 2003
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Say you've spent the first 10 years of your life sleeping under the stairs of a family who loathes you. Then, in an absurd, magical twist of fate you find yourself surrounded by wizards, a caged snowy owl, a phoenix-feather wand, and jellybeans that come in every flavor, including strawberry, curry, grass, and sardine. Not only that, but you discover that you are a wizard yourself! This is exactly what happens to young Harry Potter in J.K. Rowling's enchanting, funny debut novel, Harry Potter and the Sorcerer's Stone. In the nonmagic human world--the world of "Muggles"--Harry is a nobody, treated like dirt by the aunt and uncle who begrudgingly inherited him when his parents were killed by the evil Voldemort. But in the world of wizards, small, skinny Harry is famous as a survivor of the wizard who tried to kill him. He is left only with a lightning-bolt scar on his forehead, curiously refined sensibilities, and a host of mysterious powers to remind him that he's quite, yes, altogether different from his aunt, uncle, and spoiled, piglike cousin Dudley.