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It is calculated by dividing average output in a certain period by the total resources in terms of labor, raw materials, energy or any other cost incurred in the process in…
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Download file to see previous pages... It is a reflection of numerous economic indicators, offering an overall measure of the economic growth, competitiveness, and the living standards that are dominant in an economy. It is labor productivity which explains the basics needed to understand econmic growth and social development (Freeman). Increase in labor productivity is said to increase the standard of living in an economy. When productivity increases, the price of products and services decreases which in turns increases domestic as well as foreign consumption for those particular products and services. To meet this increase in demand, overall production increases which utilizes more use of equipment and a greater demand for workforce. Hence, employment increases, real wages of the working class grow and the overall economy flourishes (Galarneau and Dumas).
The first 3 paragraphs of the article ‘One Pay Gap Shrinks, Another Grows’ basically tells about how income distribution has not been equal. It is said that the major argument is not whether men have done better than women or vice versa. It is true that women are winning the race of obtaining college diplomas and male high school dropouts are at the top of those suffering the repercussions of the poor job situation. However, it is not only the education system that needs to be revised for better income distribution. The question that matters and need to be answered is ‘why the median worker hasn’t earned more’. There certainly has been an increase in overall wages, but this increase is very moderate. It is also believed that productivity is good but not at par with growth 1947-1963.
According to the sources, the bottom 80% of the people would have had $670 billion more of what they have now if the growth rate would had been constant from 60s. This means that the growth rate is perfectly fine but the income has not been distributed equally. ...Download file to see next pagesRead More
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