HKS Affiliated Authors


Does Productivity Still Determine Worker Compensation? Domestic and International Evidence. Robert Lawrence, 2016, Book Chapter. "The American dream is that each generation should live twice as well as the previous one, and this requires that incomes rise at an annual rate of around 2 percent per year. At this pace, incomes will double every 35 years. Between 1947 and 1970, average real compensation in the US increased at annual rate of 2.6 percent—a pace that was actually faster than required to achieve the dream. But since 1970, the average real compensation of US workers has grown at less than 1 percent per year, and at that pace it would take almost a lifetime to see incomes double." Link