The Impact of Computers and Globalization on U.S. Wage Inequality

The late 1970s and early 1980s was a time of rising wage inequality in the United States, particularly between skilled and unskilled workers. During this time, there was also a dramatic increase in on-the-job computer use. Many economists blamed the increase in computer use for the increase in wage inequality in the United States. That view became known as the skill-biased technological change hypothesis. But there are problems with the hypothesis in nearly every dimension of wage inequality in the U.S. labor market. A better explanation for the increase in wage inequality is the globalization of the U.S. economy