101 lecture 19 earnings and discrimination
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Transcript of 101 lecture 19 earnings and discrimination
Next Exam !
Exam 6 Thursday December 26
!
Chapters 18, 19, 20 and 21
Microeconomics Lecture 19
!
Earnings and Discrimination
Wage Gap
Education Experience Preferences
Discrimination is
Expensive
$0
$17,500
$35,000
$52,500
$70,000
Black White Asian Hispanic
Median Household Income
Compensating Differentials
95% of job-related deaths are men.
America’s 10 Most Dangerous Jobs
Per 100,000Average 3.3Fishing 200Logging 62
Pilot 57Farm & Ranch 36
Roofers 35Ironworkers 30Sanitation 25Machinist 19
Truck Driver 18Construction 18
Source: Bureau of Labor
bits and
atoms
atomsthe physical universe
mass and energy e = mc2
always with us cannot create or destroy
bitsdigital computer technology
ones and zeros binary digits or bits
software ideas intelligence intellectual
creativityhow we combine bits and atoms in new ways
!
adding more bits to atoms
ideas
inventions
innovations
human thought
inventors developing ideas
entrepreneurs successfully marketing inventions
China U.S.
Manufacturing 2.5 billion 2.0 billion
Workers 100 million 12 million
Output per worker $25,000 $167,000
$0
$45,000
$90,000
$135,000
$180,000
China U.S.
Output per Person
Innovation - Productivity
Continuous Innovation
ideas
inventions
innovations
People have ideas
Inventors convert ideas to
inventions
Entrepreneurs convert
inventions to innovations
inventions
go to market
$
Less than 10 percent of
inventions go to market
Less than 10 percent of
inventions that go to market are economically
successful
Less than one percent of
inventions are economically
successful
ideas
innovation
Intellectual
Financial Physical
Human
Culture
Entrepreneur
discover Experimenting
idea
create
observe
Cultural Capitaltrust values institutions infrastructure rules property rights rule of law taxes regulations stable currency mobility
Human Capitaltrust knowledge skills personality health relationships
growing human capital learning new things education reading watching listening doing
Physical Capitalnatural resources
atoms energy time
buildings equipment
tools
Intellectual Capitalideas
methods technology
recipes ways to do things
research and development publishing
Financial Capitalsavings = investment
connecting savers and borrowers investors and entrepreneurs
money and risk time is money
(1+r)n
limited liability corporations insurance
Entrepreneurial Activity
looking for opportunity alert
capture value create value
take risk
“There are no entrepreneurs
without capital.”
Capitalism, Socialism and Democracy !
Creative Destruction !
Innovation and Entrepreneurship
Joseph Schumpeter (1883 - 1950)
Intellectual
Financial Physical
Human
Culture
Entrepreneur