Economists who attempt to explain the increasing earnings gap between skilled and unskilled workers in the United States offer two main hypotheses.Both hypotheses
A) suggest that demand and supply conditions have played a less important role in determining workers' wages in recent years.
B) suggest that, over time, the demand for skilled labor has risen relative to the demand for unskilled labor.
C) emphasize the shrinking importance of international trade in recent years.
D) emphasize the growing importance of women and teenagers in the workforce in recent years.

Question

Quizplus · Accepted Answer

Both hypotheses suggest that the demand for skilled labor has increased relative to the demand for unskilled labor, leading to an earnings gap. This is due to technological change and globalization increasing the demand for skilled workers who can handle new technologies and global communication, while reducing demand for unskilled workers whose jobs can be easily outsourced or automated. Therefore, option B is the best choice.

Economists Who Attempt to Explain the Increasing Earnings Gap Between