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The Productivity to Paycheck Gap: What the Data Show

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  • Dean Baker

Abstract

This report makes a series of adjustments to the most common measure of U.S. productivity growth (i.e., non-farm business sector) as well as to measures of wage growth, to determine the extent to which lagging wages can be blamed on weak productivity growth vs. income redistribution. Weak wage growth between 1973 and 2006 has generally been attributed to a redistribution of income from typical workers to higher paid workers. However, the report shows that, along with a redistribution of income, lagging wage growth has also been caused by slow productivity growth.

Suggested Citation

  • Dean Baker, 2007. "The Productivity to Paycheck Gap: What the Data Show," CEPR Reports and Issue Briefs 2007-11, Center for Economic and Policy Research (CEPR).
    • Handle: RePEc:epo:papers:2007-11
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    File URL: http://www.cepr.net/documents/publications/growth_failure_2007_04.pdf
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    Citations

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    Cited by:

    1. Dean Baker & David Rosnick, 2007. "India: Productivity and Sustainable Consumption in OECD Countries: 1980-2005," International Productivity Monitor, Centre for the Study of Living Standards, vol. 15, pages 41-54, Fall.
    2. Jurica Bosna, 2018. "Estimation Of The Great Decoupling On The Example Of Croatia, As Compared With Germany And Poland," Poslovna izvrsnost/Business Excellence, Faculty of Economics and Business, University of Zagreb, vol. 12(1), pages 33-52.
    3. Dean Baker, 2014. "The enduring effects of the Great Recession on wage growth in the United States," European Journal of Economics and Economic Policies: Intervention, Edward Elgar Publishing, vol. 11(2), pages 195-204, September.
    4. Massimo FLORIO, 2012. "The real roots of the great recession: unsustainable income distribution," Departmental Working Papers 2012-01, Department of Economics, Management and Quantitative Methods at Università degli Studi di Milano.
    5. Joao Paulo Pessoa & John Van Reenen, 2013. "Decoupling of Wage Growth and Productivity Growth? Myth and Reality," CEP Discussion Papers dp1246, Centre for Economic Performance, LSE.
    6. Mauro Giorgio Marrano & Jonathan Haskel & Gavin Wallis, 2009. "What Happened To The Knowledge Economy? Ict, Intangible Investment, And Britain'S Productivity Record Revisited," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 55(3), pages 686-716, September.
    7. John Schmitt & Janelle Jones, 2013. "Making Jobs Good," Challenge, Taylor & Francis Journals, vol. 56(4), pages 6-21.
    8. Cowgill, Matt, 2013. "A Shrinking Slice of the Pie: The Labour Income Share in Australia," MPRA Paper 46209, University Library of Munich, Germany.
    9. Anna M. Stansbury & Lawrence H. Summers, 2017. "Productivity and Pay: Is the link broken?," NBER Working Papers 24165, National Bureau of Economic Research, Inc.

    More about this item

    JEL classification:

    • O40 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - General
    • O47 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Empirical Studies of Economic Growth; Aggregate Productivity; Cross-Country Output Convergence
    • J30 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - General
    • J32 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Nonwage Labor Costs and Benefits; Retirement Plans; Private Pensions

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