Attainment levels were low.
The main determinant of inequality is what the Harvard economics professors Claudia Goldin and Lawrence Katz call a "race between technological change and educational attainment".
Demographics, the educational attainment, and technological progress are exogenous.
It was a technological accident.
It's also worth paying attention to the excellent work of Claudia Goldin and Lawrence Katz, who have traced recent growth in wage inequality to a divergence in the relative supply of workers of various educational attainments:Skill-biased technological change has generated rapid secular growth in the relative demand for more-educated workers for at least the past century.
For much of the 20th century, however, skill-biased technological change was outpaced by advances in educational attainment.
Technological advance will tend to raise that threshold while educational attainment will tend to lower it (so that a larger share of the labour force, when displaced, is reallocated into relatively high-skill work rather than into competition for low-skill jobs).But: the real wage varies with labour supply at various skill levels.
In this section we first describe the exogenous information used in the overlapping generations model: Demographics, capital depreciation rates, labor shares, the evolution of the educational distribution, age-specific productivities by educational attainment, pension replacement rates, and our own reconstruction of the labor-augmenting technological progress.
With regard to the latter, in the last decades educational requirements for the workforce changed with the rapid technological and organisational change: qualifications of the workforce increased due to the higher educational attainment of employees in the service sector compared to those in agriculture or manufacturing.
And yet the attainment of that goal has been stymied, despite Google having at its disposal an unusual combination of technological means, the agreement of many authors and publishers, and enough money to compensate just about everyone who needs it.
