Enrico Moretti

Poverty, inequality, and cost of living differences

Because of their different geographical distribution, US households are exposed to different levels and trends in cost of living. One contribution of this paper is to document that, as a consequence, the conditional difference between the wage of skilled workers and of unskilled workers is significantly lower in real terms than in nominal terms and has grown less. In 2000, the level of the college premium is 60% in nominal terms and only 51% in real terms.