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Published online by Cambridge University Press:  16 August 2002

Donald R. Deere
Economics, Texas A&M University
Finis Welch
Economics, Texas A&M University


Measured inequality has increased tremendously between the 1960s and 1990s, not only in the United States but throughout the majority of industrial nations. Wages among people of the same race and gender have become less equal. The hours worked by men have fallen, and the drop has been more pronounced among those who earn lower wages—as a result, inequality in labor income, which is the product of the wage rate and hours worked, has increased relative to inequality in wage rates. Moreover, among married couples, employment of the wives of high-income men has increased until these wives are approximately as likely to be employed outside the home as are the wives of low-income men, who have always worked for wages. In addition, due to assortative mating, wage rates of husbands and wives are positively correlated, and it is clear that the growth in inequality of labor incomes among families has outstripped the growth in inequality in individual labor income. Finally, only the highest-income families have savings in excess of home equity and company-sponsored pensions, which implies that inequality in wealth among families has been exacerbated by the growth in stock prices.

Research Article
© 2002 Social Philosophy and Policy Foundation

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