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Posts published in November 2008

Productivity and Earning by Mayatiita

I am attaching a graph I've prepared for my classes. It shows productivity
growth (output per hour), average earnings, and total compensation for the
U.S. The difference between average earnings and total compensation is that
total compensation includes benefits, notably health insurance. The diagram
gives evidence that in recent years an important drag on earnings in the U.S.
has been the high cost of providing medical benefits.

Economic theory tells us that productivity and earnings will grow together.