An Analysis of Wage Stagnation and Inequality over the Past Half Century

This paper entitled "An Analysis of Wage Stagnation and Inequality over the Past Half Century" is a literature review that examines and analyzes three main studies by Robert Lawrence, David Card and John DiNardo, and the Economic Policy Institute, and uses other works by a variety of economists to supplement that analysis. The paper aims to understand and precisely define the issue of wage stagnation and inequality and distinguish between the two. To do this, the paper looks at which groups are primarily affected, the different types of inequality that exist, in which time periods those types of inequality operate, any potential causes of the issue, and any potential solutions. The studies all agree that wage stagnation and inequality exist and each looks at middle earners \u2014 one looks at blue-collar workers and the other two choose the median earner \u2014 either way, the focus of the studies are those earners in the middle of the earnings distribution. Each study varies in its focus of the potential causes and solutions to the issue. Robert Lawrence, an international trade theorist, looks at the problem of wage stagnation and inequality through the lens of globalization and specifically if free trade is a key contributor. David Card, a labor economist, and John DiNardo look at the issue through the lens of technology change, specifically the Skills-Biased-Technological Change (SBTC) Hypothesis and question if technological advances are what caused this stagnation and inequality. The Economic Policy Institute, a left-leaning think tank, look at this issue through the lens of policy and question if poor policy regimes over the past half century have allowed wage stagnation and inequality to thrive. Overall, the three studies examined are similar enough in time period and subject studied, yet different enough in the lens through which the issue is viewed to provide a well-rounded summary and analysis of current literature by prominent economists on wage stagnation and inequality.