Economist Lester Thurow said, "It used to be that if you were an American and relatively unskilled, you got an American premium, cause you'd work with more raw materials, better capital, better technology, so you would get more competitive wages."

Can you provide examples of what he means by this?


In the 1950s, if you were an unskilled American, you could work at a car factory (with its adequate raw materials, capital/machinery, technology). You thus earned vastly more than equally skilled workers in other countries.

Today with competition from Japanese, Korean, and other carmakers, this "American premium" has been reduced. An unskilled American no longer earns vastly more than similar workers in other countries.

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