From “The Upswing: How America Came Together a Century Ago and How We Can Do It Again” by Robert D. Putnam
Most experts agree that a primary cause of the Great Convergence was the interplay between technological advance and the educational innovations (especially the public high school) that emerged from the Progressive Era around 1910. Other things being equal, more widespread education means more equality, as the increased supply of high-skilled workers puts downward pressure on higher incomes, while the decreased supply of low-skilled workers puts upward pressure on lower incomes. That dynamic is offset by technological progress, which increases the demand for (and hence the incomes of) high-skilled workers and lowers the incomes of low-skilled workers. Hence, the title of the groundbreaking book that aims to explain the up and downs of income equality over our period is The Race Between Education and Technology.
The massive growth of public secondary education beginning in the early twentieth century and of college education after World War II had two important consequences. It raised the rate of national economic growth, and it increased the rate of upward mobility, by giving a fairer start to kids from the wrong side of the tracks. A third, related consequence is that these reforms raised Americans’ skill levels and thus boosted the relative income of the middle and working class. In the first two thirds of the century, while the demand for skill edged upward, that change was eclipsed by the rapid increase in the supply of high school and college graduates. Because the American labor force became by far the best educated in the world, the balance between education and technology tipped in favor of equality.