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4.Note that a declining share of employment does not imply a declining share of output.See Baumol, Blackman, and Wol., Productivity and American Leadership.
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5.Baumol, Blackman, and Wol., Productivity and American Leadership, ch..6.
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6.Rowthorn and Ramaswamy, “Growth, Trade, and Deindustrialization.” Specifically, they find that the relative share consumers spend on manufactured goods tends to increase in early stages of development and to decrease later on (that is, the income elasticity of manufactured goods is greater than one initially and less than one later on).
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7.Manufacturing might be more affected by globalization because many services are not “offshorable.” However, mature services are also increasingly being performed overseas today, thanks, in part, to information technologies; see Blinder, “How Many United States Jobs Might Be Offshorable?”
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8.Baumol and Bowen, “On the Performing Arts.”
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9.See Baily and Bosworth, “U.S.Manufacturing”; Triplett and Bosworth, “Productivity Measurement Issues,” claiming Baumol’s disease has been cured.
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10.U.S.Department of Commerce, “Benefits of Manufacturing Jobs.”
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11.My argument is consistent with the interpretation that manufacturing workers are paid “efficiency wages” in order to keep them from quitting (Krueger and Summers, “Efficiency Wages”).Because these workers have greater firm-specific knowledge, employers have greater incentives to reduce employee turnover.Moreover, while efficiency wages might also be paid to reduce shirking on the job, a worker’s output is often easier to measure in manufacturing than the output of service workers, so shirking might not explain greater efficiency wages in manufacturing.
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12.Bureau of Labor Statistics, “Employment by Summary Education.”
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13.Pisano and Shih, “Does America Really Need Manufacturing?”
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14.Blinder, “How Many United States Jobs Might Be Offshorable?”
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15.American Nurses Association, “American Nurses Association’s First Position.”
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16.Kleiner and Kudrle, “Does Regulation Affect Economic Outcomes?”; Kleiner and Krueger, “Analyzing the Extent.”
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17.Graddy, “Toward a General Theory.”
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18.Fox-Grange, Scope of Practice.
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19.It is important to distinguish licensure from certification in this regard.Many occupations have certification; practitioners can become certified by passing an exam or by meeting other requirements.Certification also serves as a means to verify the quality and safety of service that a practitioner provides.Licensure goes beyond certification by limiting who can practice the occupation.
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20.Wanchek, “Dental Hygiene Regulation.”
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21.Kleiner with Kyoung Won Park, Stages of Occupational Regulation, ch..6.
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22.Kleiner and Kudrle, “Does Regulation Affect Economic Outcomes?”
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23.Kleiner, Licensing Occupations; Kleiner, Stages of Occupational Regulation.
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24.Kleiner,“Occupational Licensing”; Kleiner and Krueger, “Analyzing the Extent.”
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25.Liang and Ogur, “Restrictions on Dental Auxiliaries.”
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26.Kleiner et al., “Relaxing Occupational Licensing Requirements.”
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27.Wanchek, “Dental Hygiene Regulation.”
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28.Humphris,Kleiner, and Koumenta, “How Does Government Regulate Occupations?”
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