Tonight’s “Public Affairs” Chicago Metro N and NW suburban edition features Chicago Booth and UChicago Economics Department Professor Kevin Murphy discussing how changes in the demand for and supply of specific, high quality, human capital explain the sharp increase in income inequality.
The show also airs tonight in 24 Chicago Metro suburbs at 8:30 pm on Comcast Cable Ch. 19 or Ch. 35. See below for more details as to tonight’s airing schedule and the airing schedule later in the week in Evanston, Aurora, Rockford and other geographic areas.
Income inequality? It’s all demand and supply
As Professor Murphy emphasizes, historical accumulations of human capital (largely reflected by quality schooling) by individuals build on prior accumulations, so the current high income inequality reflects the sharp growth in the acquisition of human capital (schooling) by some (and missed by others) that started in the 1970s, accelerated rapidly in the 1980s and continues its cumulative impact to the present.
For various reasons, the growth in demand for quality human capital outstripped the growth of supply.
Jeff’s law, “Demand creates its own supply,” seems not to have worked here. The culprit here is largely government, but that’s the topic of another show.
This focus on the importance of human capital is but one of many lessons from the Chicago School of Economics that are discussed tonight. Another lesson, as noted by Professor Murphy, and as illustrated in the work of his colleague, UChicago Economics Department Nobel Prize laureate Jim Heckman, is that if we can avoid creating deficiencies of human capital in our kids’ first few years of life, that very significant beneficial impact will continue to be felt up to and including their graduation from college.
Competition and School Choice
Further, as Murphy emphasizes, correcting the current U. S. deficiencies in k-12 education (felt predominantly by children of low income minority parents in the inner cities) by introducing more competition, more school choice into education via charter schools, school vouchers and facilitation of home schooling would go a long way toward reducing income inequality in the United States.
The Chicago School of Economics:
Much of the remainder of the show is devoted to understanding the Chicago School of Economics– who it was, what it is and its impact on public policy during the last half century. For more on that topic, read the second half of this post.
The Kevin Murphy show airing schedule for tonight, the remainder of this week and next week is as follows:
— Tonight in 24 Chicago Metro North and Northwest suburbs at 8:30 pm on Comcast Cable Ch. 19 or Comcast Cable Ch. 35, as indicated, below:
Comcast Cable Ch. 19 in Buffalo Grove, Elk Grove Village, Hoffman Estates, parts of Inverness, Lincolnwood, Morton Grove, Niles, Northfield, Palatine, Rolling Meadows and Wilmette and on
Comcast Cable Ch. 35 in Arlington Heights, Bartlett, Glenview, Golf, Des Plaines, Hanover Park, Mt. Prospect, Northbrook, Park Ridge, Prospect Heights, Schaumburg, Skokie, Streamwood and Wheeling.
—- Tomorrow night and next Monday and Wednesday nights in Evanston at 8:30 pm on Cable Ch. 6.
—- This Wednesday night, Saturday night and Next Monday, Wed. and Sat. nights in Aurora and surrounding areas at 6:00 pm on ACTV-10 (Aurora Community Television).
—- This Thursday night and next Thursday night in Rockford and surrounding areas at 8:30 pm on Comcast Cable Ch. 17.
—- Next Monday and Wed. nights in Highland Park, Deerfield, Winnetka and Highwood on Cable Ch. 19 at 8:30 pm
— and Next Monday night throughout the City of Chicago at 8:30 pm and midnight on Cable Ch. 21 [CAN TV]
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Tags: Becker Friedman Institute, Chicago Booth, Chicago School of economics, demand for human capital, Gary Becker, George Stigler, human capital, Income inequality, income inequality caused by variation in human capital, Jeff Berkowitz, Kevn Murphy, MIlton Friedman, Public Affairs, skillbased premium for labor compensation, Stigler Center, supply of human capital, University of Chicago