Rewarding Work: How to Restore Participation and Self-Support to Free Enterprise, with a New Preface

Edmund Phelps

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. An August 2010 interview with the author about Rewarding Workcan be found at the following link. Second Edition, 2007. (Harvard University Press)