Economic theory suggests that wages should track productivity. Do the data support that in real life?
Scott Winship of the American Enterprise Institute looked at that question in light of claims to the contrary. He finds that, when measured consistently, pay and productivity track each other remarkably well. I had him on Econception, my podcast with the American Institute for Economic Research, to talk in depth about pay, productivity, and the real problems in the U.S. workforce.
I discuss Jonathan Kanter’s claim to being the representative of the American people. Nobody voted for the assistant attorney general for the Department of Justice Antitrust Division. Bureaucrats are not representatives.
I also look at Patrick Lynch’s review for AIER of former U.S. trade representative Robert Lighthizer’s book. Lynch compares support for tariffs to the same political dynamics that Bruce Yandle described as “Baptists and bootleggers,” i.e., that both groups supported Prohibition but for very different reasons. He says Lighthizer is a “bootlegger in a Baptist’s mask.”
Scott picked the Paper of the Episode: “Where is the Land of Opportunity? The Geography of Intergenerational Mobility in the United States,” by Raj Chetty, Nathaniel Hendren, Patrick Kline, and Emmanuel Saez. Read it here.
Listen and subscribe to Econception on a variety of platforms here.