37
votes
Accepted
Why do celebrities get high wages?
If you ask yourself how much a potential employer would have to pay you to convince you to work for him, the answer is probably something like "at least as much as I could earn by doing the same job ...
- 16.9k
33
votes
Did real incomes drop significantly since the 1950s?
Most of the US real earnings data which go only as far as mid 60s. According to the statista data presented in this article by world economic forum the evolution of real hourly earnings in the US for ...
- 54.4k
23
votes
Did real incomes drop significantly since the 1950s?
Average standard of living is massively higher today compared to the 1950s, primarly due to technological progress.
Even a cheap low end car today is much better than the big cars of the 1950s, it is ...
- 567
22
votes
Accepted
Why are real median household incomes stagnant?
The metric of median household income is also used by others to argue the presence of income inequality:
https://en.wikipedia.org/wiki/Income_inequality_in_the_United_States#Causes
However, it seems ...
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19
votes
Why do celebrities get high wages?
I suggest to learn more about the Economics of Superstars. Within the economics field, the "superstar" term is "...used to refer to extreme wage outliers (Adler, 1985; Rosen, 1981). These outliers are ...
- 342
15
votes
Did real incomes drop significantly since the 1950s?
The book “The Two Income Trap” (2003) by Elizabeth Warren (recent Democratic presidential candidate) and Amelia Warren Tyagi discussed this. They looked at spending breakdowns in the 1970s and when ...
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10
votes
Accepted
When countries industrialise, why do jobs from agriculture shift to manufacturing?
This is a common area of study in Development Economics. There is for example the Dual-sector model, first developed in 1954. It is very well explained in the link provided, but basically:
[the] ...
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8
votes
Minimum Wage effects on Adjacent Cities
A very famous study in this direction is Card and Krueger (1994).
They look an increase in the minimum wage in New Jersey in 1992. While New Jersey raised the minimum wage from USD 4.25/h to USD 5.05/...
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6
votes
Who really benefits from economic growth?
I suppose that it depends on the time scale you are considering. Over the very long run the poor seem to have benefited far more than the rich from growth. See for example Robert J. Samuelson in the ...
- 16.3k
6
votes
Accepted
Minimum wage vs wage subsdies
We could distinguish between two kinds of "wage subsidies":
A) The government pays to the firm part of the wage cost, usually social security fees.
B) The government pays to the employee a markup ...
- 33.4k
6
votes
Why are real median household incomes stagnant?
Three points - one which has already been raised much better by denesp:
Are household sizes the same (we see the answer as no)? How about amount of earners per household?
What about the amount of ...
- 161
6
votes
Productivity vs real earnings in the US -- what happened ca 1974?
Here is one explanation, albeit focusing on the wider economy, and comparing median wages. Still the method applies:
This is taken from Bivens and Mishel (2015). In essence, they decompose labour ...
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6
votes
When countries industrialise, why do jobs from agriculture shift to manufacturing?
A schematic picture is as follows:
Industrialization also means industrialization of Agriculture. This kills land-related jobs in the sector while at the same time it increases output. Inceased ...
- 33.4k
6
votes
What's the logic behind dividing rental price of capital and wage rate by price level?
Price level is the general level of prices in an economy. It is a variable that indicates what is the purchasing power of money (see Blanchard et al. Macroeconomics: a European Perspective). You can ...
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5
votes
Why do celebrities get high wages?
The other answers already give a good explanation about how actors are not easily replaced. But I'd like to highlight a flaw in the premise of your question: namely that you are cherry-picking data. ...
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5
votes
Accepted
Putting a Price on Happiness
There are several approaches to this problem, none of them accurate as the human happiness is internal subjective experience and thus not verifiable by people other than the afflicted (it is not ...
- 462
5
votes
Nonlinear Least-Squares Estimation in Practice
Suppose the relationship between $y_{i,t}\equiv\log w_{i,t}$ and $z_{i,t}\equiv\left(s_{i,t},j_{i,t},e_{i,t},x_{i,t}\right)^{\top}$ is given by
$$y_{i,t}=g\left(z_{i,t}\right)+\varepsilon_{i,t},$$
...
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4
votes
Why do celebrities get high wages?
They are both irreplacable and cause the people to work for to earn lots of money.
Celebrities, by definition, are personalities with mass appeal and are therefore known by a large number of people. ...
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4
votes
Why do rich countries remain rich?
The first answer of presented in the list is wrong. GDP is measure of current production not of past inherited wealth. Even though the existing capital plays a part, the lowest of deprecation rate is ...
- 456
4
votes
When countries industrialise, why do jobs from agriculture shift to manufacturing?
Aside from the economic arguments, a big difference was the amount of autonomy for the workers.
Consider agriculture and similar rural employment (as servants etc) in the UK, even as recently as 1900....
- 451
4
votes
Has US real median personal/household income been stagnant since the late 1970's/early 1980's?
As said in the comments, there is an important difference between household income and wages. Household income includes income from capital. As a higher share of total income is going to capital than ...
- 8,581
4
votes
Statistical distribution of wages and wealth
Globally, there is Lakner and Milanovik (2015)'s elephant graph:
Hellebrandt and Mauro (2015)
Thus, the two previous distributions look like bimodal log-normal distributions.
or CDFs, as in ...
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4
votes
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How much average value does 1 working hour produce? ( are there reliable statistics?)
That is a great question. And it depends (famous economics response to anything).
Here are some of the factors on, “how much does 1 hour of work produces”:
- Persons education and training level
- ...
- 1,471
4
votes
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What does Smith mean by "price of work" in this context?
Smith was talking of "the price of work" as meaning the price of economic products bought from the employers and merchants, not the price of labour bought from the workers.
"Work" ...
- 626
4
votes
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Can you prove, and with what assumptions, that a market will allocate some minimum amount of basic resources to every worker?
There is no guarantee that anyone in market economy earns some subsistence minimum. Generally, wage depends on marginal product of worker's labor and if there are some quasi-rents to be had also on ...
- 54.4k
4
votes
Accepted
I don't know why these two method yield different solutions for marginal product of labour
I am not sure why you expect method two to work, as generally
$$
\frac{\partial F(K,N)}{\partial N} \neq \frac{\partial F(K,N)}{\partial K}\frac{\partial K}{\partial N}.
$$
These are partial ...
- 28.7k
4
votes
Accepted
How is potential experience usually measured in the Mincer equation?
True that, in principle, we can approximate potential experience by age - schooling and that this is bound to depend on the assumptions made on entry into the labor market.
For the US, it seems to me ...
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4
votes
Accepted
Why did the pay of CEOs decrease around the year 2000?
2001 was the time the dot-com bubble burst. CEOs and other highly ranked employees get most of their income from bonus payments, which are often tied to stock prices and revenues, and the like (which ...
- 4,008
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