Trends in U.S. wage inequality : revising the revisionists : a replication study of Autor, Katz, and Kearney (The review of economics and statistics, 2008)

This study compares the estimation errors of several present value discounting conventions (end-of-year, mid-year, and the more recently proposed harmonic mean convention) for a uniform distribution of intra-period cash flow - continuous and discrete. Our results show that the mid-year convention performs best for continuous uniform cash flow streams, and that the mid-year and harmonic mean conventions produce smaller errors for discrete uniform cash flow streams than the end-of-year convention. We supply conditions for the order of preference in the case of discrete uniform cash flow distributions and provide some additional insights into the errors of the discounting conventions for both continuous and uniform intra-period cash flow distributions.This paper successfully replicates Autor et al. (2008) and extends their analysis through 2022. The extension to an additional 17 years of analysis underscores the original finding that rising wage inequality was not an episodic event of the 1980s. That being said, overall 90/10 inequality and the college wage premium have plateaued since 2005. Despite overall inequality plateauing, upper- tail 90/50 inequality has continued to increase since 1980 for both men and women. I also find that the composition-adjusted real wages of high school dropouts has caught up with high school graduates in the last decade. Between 2012 and 2022, high school dropouts saw larger real wage gains than any other education group. The combination of these findings is consistent with rising polarization in which employment and wages expand for high-wage and low-wage work.