## The Inequality Economist

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### AI and future inequality
- Two scenarios Katz outlines for AI’s labor-market effects:
  - AI could help people already in advanced, high-paying professions, “thereby potentially exacerbating labor market inequality.”
  - AI could “help level the playing field for workers on the lower end of the scale” by making elite expertise less scarce and “making the insights from elite expert knowledge more accessible to a broader range of workers,” which “could help middle-skill workers versus elite professionals.”
- Katz’s role: leading academic economists (many former students) will assess AI using his methods—big data and sophisticated analysis.

### Research contributions and empirical methods
- Early emphasis on large-scale data analysis and longitudinal survey data long before modern computing advances.
- Key methodological impacts:
  - Applying supply-and-demand frameworks to explain wage-inequality fluctuations over time.
  - Leading large-scale field experiments involving real people to answer social-science questions (example: Moving to Opportunity).
- Notable papers and findings:
  - 1992 collaboration with Olivier Blanchard: studied 40 years of state-by-state US data after unemployment nearly tripled in Massachusetts between 1987 and 1991; concluded that state unemployment spikes largely decline because workers leave the state rather than employers creating new jobs.
    - Rebound from an unemployment spike takes “five to seven years.”
    - It takes “more than a decade for wages to return to normal.”
  - 1992 paper with Kevin Murphy: analyzed US wages from “1963 to 1987” using Census Bureau data; found income gap narrowed from 1970 to 1979 and widened dramatically after 1979, driven in part by a sharp decline in the growth of the supply of college-educated workers relative to rising demand.

### Education, technology, and inequality
- Major thesis (The Race between Education and Technology, 2008, with Claudia Goldin):
  - US early 20th-century “high school movement” provided a large education advantage relative to most European countries; by the 1930s “America was virtually alone in providing universally free and accessible secondary schools.”
  - Late-20th-century widening inequality reflected a shortfall in ongoing investment in education rather than only technological speed.
- Policy implications Katz advocates:
  - Invest more in state universities.
  - Strengthen vocational education and sectoral employment training programs for high school graduates.
  - Avoid leaving postsecondary education provision solely to families; the incomplete postsecondary education revolution contributed to rising inequality.
- Quantified contribution:
  - “Fifty to 60 percent of the rise in US wage inequality since 1980” grew out of the slowdown in educational advances relative to continuing growth in demand for college-educated workers.
- Other contributing factors Katz cites:
  - Decline of unions.
  - Erosion of the federal minimum wage.
  - Surge in executive and top-end compensation.
  - Fissuring of supply chains with increased domestic outsourcing, greater use of the gig economy, and international offshoring.
- Katz’s critique of for-profit colleges: his papers in the 2010s showed that employers put little value on degrees from costly for-profit colleges.

### Moving to Opportunity (MTO) field experiment and policy relevance
- Katz’s role: as 1993 chief economist of the Department of Labor, he helped design the Moving to Opportunity housing mobility program.
- Program details and sample:
  - Began in 1994 in Boston, Baltimore, Chicago, New York City, and Los Angeles.
  - Included “4,604 families” living in public housing in some of the country’s poorest neighborhoods.
- Findings over time:
  - Initial results did not show immediate economic benefits for adults.
  - Participants reported improved physical and mental health.
  - Long-run results: children who were younger than 13 when their families moved experienced “30 percent higher earnings as young adults,” were more likely to attend college, got into better colleges, and lived in lower-poverty neighborhoods as adults.
- Policy implications and attempts:
  - Local governments (example cited: Seattle) apply findings to housing-voucher programs.
  - The Biden administration sought to fund a broader program, but “it all got killed” in negotiations with Congress.
- Katz’s view: “Where you live affects how healthy you are and many other things,” and “We could do a lot more using existing resources.”

### Editorial leadership and mentorship
- Editor of the Quarterly Journal of Economics (QJE) since 1991; described as shaping the agenda of the economics profession over three decades.
- Journal metrics cited:
  - QJE receives “about 2,000 submissions a year” and publishes “48.”
- Personal editorial approach:
  - Katz “reads and responds to every paper that’s submitted,” pushes researchers to take risks, and encourages following the data.
- Mentorship and network:
  - Katz has trained “more than 200” former doctoral students (article also cites “239 PhD economists” he has trained).
  - Protégés include winners of the John Bates Clark Medal, MacArthur Foundation grantees, and many tenured scholars at top universities.
  - Katz maintains a detailed list of former students on his Harvard website.
- Institutional and labor roles:
  - Mediated labor negotiations and disputes at Harvard for “the past 25 years,” leading the Katz Committee and influencing outsourcing wage-and-benefits parity policy in 2001.

### Key personal and career milestones (as presented)
- Katz’s age in article: “64-year-old Katz.”
- PhD from MIT in “1985.”
- Early career: first researcher at Fisher Center for Real Estate and Urban Economics in “1979.”
- Editor of QJE “since 1991” and described as having led the journal for the “past 32 years.”
- Collaboration with Claudia Goldin (met in the late 1980s); Goldin is noted as a 2023 Nobel laureate.
- Family and background notes: son of a Los Angeles public school psychologist; mother born Vera Reichenfeld in 1938 in Belgrade; she is “at the age of 85” working part-time as an actress.
- Anecdotes and influences: senior thesis on effects of Proposition 13 property-tax changes; early work on unemployment mechanics challenging sectoral-shift explanations.

*Source: DECEMBER 2023, “People in Economics — The Inequality Economist” by Bob Simison.*

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_Source: https://www.imf.org/-/media/files/publications/fandd/article/2023/december/66-69-people-in-economics-final.pdf_