The proportion of workers earning low wages in the American economy declined from 1963 through 1979. Since 1979, both the low-wage and the high-wage shares of employment have increased, leading to wage polarization. Analysis of Current Population Survey data indicates that this occurred for both...

This paper is organized in three parts. First, we present the logic and original evidence for Phillip's Curve and NAIRU. We show that the sources of increased labor supply during the past two expansions have shifted significantly compared with the experience of the 1970's business cycle. The...