Exam 15: Inequality in Earnings

Suppose that men,ages 25-64,with earnings of $22,000 are at the 20th percentile of the earnings distribution,while those with earnings of $84,000 are at the 80th percentile of the earnings distribution.Interpret these figures.What is the 80:20 earnings ratio? What does this ratio tell us?

Suppose all persons have the same innate ability and the same access to capital markets.Which of the following will decrease inequality?

Assume that less skilled workers are in the lower half of earnings.Which of the following events would cause the 80:20 ratio of incomes to go from 2.0 to 3.0?

Since 1980 the real wages of unskilled workers in most of Western Europe have ________ and this helps explain why their unemployment rates have ________.

Since 1980 the earnings of middle-aged college-educated males has ________ relative to those of high-school-educated males; and the earnings of middle-aged college-educated females has ________ relative to those of high-school-educated females.

Much of the recent growth in income inequality was caused by

If all incomes were to double (due to inflation,for example)then the coefficient of variation of income will

"One important factor accounting for the widening gap between the wages of highly educated and less educated workers is that the supply of less educated workers rose faster than the supply of college graduates driving down the relative wages of less skilled workers." Agree or disagree with the statement and justify your position.

Data on the ratio of wages of full-time workers at the 90th percentile to those at the 10th percentile show all the following EXCEPT

What institutional forces might account for the increase in earnings inequality observed since 1980? Explain.

Which of these decades had the greatest increase in inequality?

Table 14.1 Incomes in Pololand Period 1 Period 2 Period 3 Period 4 Thomas \ 50,000 \ 40,000 \ 60,000 \ 100,000 Nina \ 40,000 \ 40,000 \ 40,000 \ 80,000 Becky \ 30,000 \ 30,000 \ 30,000 \ 60,000 Rose \ 20,000 \ 20,000 \ 20,000 \ 40,000 Charlie \ 10,000 \ 20,000 \ 0 \ 20,000 -The greatest growth of earnings disparities within an occupation in the 1980s occurred

Which of the following will reduce inequality?

What are the dimensions along which changes in the earnings distribution have occurred since 1980?

Table 14.1 Incomes in Pololand Period 1 Period 2 Period 3 Period 4 Thomas \ 50,000 \ 40,000 \ 60,000 \ 100,000 Nina \ 40,000 \ 40,000 \ 40,000 \ 80,000 Becky \ 30,000 \ 30,000 \ 30,000 \ 60,000 Rose \ 20,000 \ 20,000 \ 20,000 \ 40,000 Charlie \ 10,000 \ 20,000 \ 0 \ 20,000 -The Lorenz curve will ________ whenever the distribution of family income becomes less equal.