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Overview


Since the 1970s a gulf has opened between the pay of low-paid workers and the pay of the middle class. No longer able to earn a decent wage in respectable work, many have left the labor force, and the job attachment of those remaining has weakened. For Edmund Phelps, this is a failure of political economy whose widespread effects are undermining the free-enterprise system. His solution is a graduated schedule of tax subsidies to enterprises for every low-wage worker they employ. As firms hire more of these workers, the labor market would tighten, driving up their pay levels as well as their employment.
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Product Details

  • ISBN-13: 9780674026940
  • Publisher: Harvard University Press
  • Publication date: 9/1/2007
  • Edition description: Second Edition
  • Edition number: 2
  • Pages: 210
  • Product dimensions: 0.44 (w) x 6.14 (h) x 9.21 (d)

Meet the Author

Edmund S. Phelps is McVickar Professor of Political Economy at Columbia University and winner of the 2006 Nobel Prize in Economics.
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Table of Contents


Preface 2007     vi
Preface     ix
Prologue     1
The Problem
Why Work?     11
America's Second-Class Workers     16
The Decline of Labor     27
The Damage to Others     38
The Causes
Is It Culture?     51
Economic Sources     64
The Role of the Welfare System     83
The Remedy
The Market-Based Solution     103
The Case for the Market-Based Solution     122
The Flaws in Other Approaches     144
Reply to Objections     156
Epilogue     167
Cost of the Model Wage Subsidy Plan     175
Notes     177
Index     195
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