ChangHwan Kim's Review of Jake Rosenfeld's "You're Paid What You're Worth, and Other Myths of the Modern Economy"
In his latest book, You’re Paid What You’re Worth, and Other Myths of the Modern Economy (YPWYW), Jake Rosenfeld debunks the pervasive myth that salary is determined mainly by individual performance or occupation. The human capital theory argues that with more education, a person becomes a more productive worker as human capital accumulates in their body, and as a result their pay tends to rise. As a person who teaches sociology of labor markets, I know that such explanations fit well with students’ typical perceptions of pay. However, when they realize that the explanatory power of education and productivity-related covariates on earnings is low, they start to ask what explains the remaining variation. Rosenfeld answers this question with a mix of theoretical arguments, original survey research, historical events, and literature review. One of the great features of this book is its wealth of real-world cases. YPWYW is likely the most case-rich book I’ve ever read.