Skills, education, and the rise of earnings inequality among the “other 99 percent”

Peer-reviewed Publication

David Autor

May 2014

The singular focus of public debate on the “top 1 percent” of households overlooks the component of earnings inequality that is arguably most consequential for the “other 99 percent” of citizens: the dramatic growth in the wage premium associated with higher education and cognitive ability. This review by Blueprint’s David Autor documents the central role of both the supply and demand for skills in shaping inequality, discusses why skill demands have persistently risen in industrialized countries, and considers the economic value of inequality alongside its potential social costs. Autor concludes by highlighting the constructive role for public policy in fostering skills formation and preserving economic mobility.