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Wage stagnation is an 'illusion'

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Many economists, politicians and pundits assert that median wages have stagnated since the 1970s. That's a call for government to do something about it. But before we look at the error in their assertion, let's work through an example that might shed a bit of light on the issue. Suppose that you paid me a straight $20 an hour in 2004. Ten years later, I'm still earning $20 an hour, but in...

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