Many economists believe that the trend toward greater wage inequality across the U.S. economy was primarily caused by:

A. the recession
B. new technologies
C. the rise of global markets
D. inflation



Answer :

Final answer:

Technological progress and globalization have contributed significantly to the trend of growing wage inequality in the U.S. economy.


Explanation:

Technological progress has been a significant factor in the trend toward greater wage inequality across the U.S. economy. Changes in technology have led to the emergence of 'winner-take-all' labor markets, where high-skilled labor earns significantly more relative to low-skilled labor due to increased global demand for 'stars' in various fields.

This global demand has driven up salaries beyond the traditional productivity differences, especially for individuals with higher education levels. As a result, those with at least a four-year college bachelor's degree earn substantially more compared to those with only a high school degree, exacerbating income inequality.

The impact of globalization has also played a role in rising wage inequality by shifting jobs to lower-wage geographies, which has put pressure on wages in higher cost-of-living countries like the United States.


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