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Productivity vs real earnings in the US -- what happened ca 1974?
Somewhat related to the most recent US elections, I've been researching the whole "white working class" situation, and one strange anomaly has popped up. When one looks at a graph of productivity (for the US) vs real wages, there is a marked "disturbance in the force" around 1974. ( 11/18/18 note: A nearly identical graph appears in Scientific American, Nov 2018, p 61, in an article titled "A Rigged Economy".) Is there any agreement among economists as to what caused wage growth to plateau like this? Update: I studied the article that luchonacho suggested, by Bivens & Mishel (2015), and found it interesting, but it didn't directly address my question. The article was basically a justification for the numbers presented in the above graph and similar presentations, in particular arguing against skeptics that the productivity numbers were real -- that productivity hadn't leveled off with wages. I'm not able to evaluate these arguments to any significant degree, but at least on the face of it their justification seems sound. However, that article pointed me to an earlier article by Bivens, et al (2014) which does attempt to identify the factors that caused the change of trajectory of productivity. I'm still evaluating this article, but it can be noted that: This was during the Nixon administration This was during a period of fairly serious "stagflation" Nixon ordered his wage/price freeze in August of 1971 The Arab oil embargo began in 1973 The US went off the gold standard in 1971 The US trade balance went negative in 1972 and has remained mostly negative ever since Union membership, which had been declining since the 50s, began a steeper slide in the 70s OSHA was founded in 1971 And, of course, the CEO-to-worker compensation ratio climbed slowly but steadily through the 70s (after being relatively flat for the entire postwar period), then accelerated rapidly in the late 80s Which of these factors (or several other ones too "minor" to mention here) is relevant to my qu
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