Contemporary Labor Economics
11th Edition
ISBN: 9781259290602
Author: Campbell R. McConnell, Stanley L. Brue, David Macpherson
Publisher: McGraw-Hill Education
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Question
Chapter 4, Problem 11QS
To determine
Explain the distribution using the human capital theory.
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During the 1970s, the wages of high school graduates rose more than the wages of college graduates. During that same time, the fraction of high school graduates enrolling in college decreased substantially. Is this decrease in the college enrollment rate consistent with the human capital model of education? Explain (make sure to explain what the human capital model of education is as part of your answer.
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- Why does the earned income tax credit increase the labor force participation rate of targeted groups?arrow_forwardDiscuss how the wage-schooling locus is determined in the labor market, and why it is upward sloping and concave.arrow_forwardMajor conclusions that can be drawn from the Hedonic theory of compensating wage differentials.arrow_forward
- Assume we are investigating gender differences in labor market outcomes and we are analyzing employee discrimination. When discussing employee discrimination, the typical assumption is that two groups of workers are perfect substitutes. Some research, however, suggests that worker productivity rises when the diversity of the workforce in a firm increases. This implies that the marginal productivity of male workers increases as more female workers are hired. If employee discrimination occurs against women, under what conditions will a gender-segregated workforce exist? Will a wage gap between men and women exist? Explain your answer.arrow_forwardHow is the market-compensating wage differential between safe jobs and risky jobs determined? Which type of job will offer a higher wage?arrow_forwardThe Marginal Productivity theory of income determination implies everyone gets paid for the value they produce: Critically assess this claim, exploring the arguments and evidence for and against it, and outline the most prominent alternative theory of income distribution and inequality.arrow_forward
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