We analyze how relative wage movements across birth cohorts and education groups during the 1980s affected the distribution of household consumption. The analysis integrates the labor economics literature on time variation in the wage structure with the consumption insurance literature. In contrast to previous tests of consumption insurance, we examine the impact of systematic. publicly observable shifts in the hourly wage structure. To circumvent the extreme scarcity of longitudinal data with high quality information on both consumption and labor market outcomes, we draw upon the best available cross-sectional data sources to construct synthetic panel data on consumption, labor supply and wages.We find that low-frequency movements in the cohort-education structure of pre-tax hourly wages drove large changes in the distribution of household consumption. The results constitute a spectacular failure of the consumption insurance hypothesis, and one that is not explained by existing theories of informationally constrained optimal consumption allocations. We also develop a procedure for assessing the welfare consequences of deviations from full consumption insurance and, in particular, from the failure to insulate the consumption distribution from relative wage shifts across cohort-education groups. For a coefficient of relative risk aversion equal to two, fully insulating households from group-specific endowment variation would raise welfare by an amount equivaltnt to a uniform 2.7% consumption increase.

THIS PAPER EXPLOITS a rich and largely untapped source of information on the wages and other characteristics of individual manufacturing plants to cast new light on recent changes in the U.S. wage structure. Our primary data source, the Longitudinal Research Datafile (LRD), contains observations on more than 300,000 manufacturing plants during census years (1963, 1967, 1972, 1977, 1982) and 50,000-70,000 plants during intercensus years since 1972. We use the information in the LRD to investigate changes in the plant-wage structure over the past three decades. We also combine plant-level wage observations in the LRD with wage observations on individual workers in the Current Population In preparing the data for this study we have greatly benefited from the assistance of Bob Bechtold, Tim Dunne, James Monahan, Robert McGuckin, and other Census Bureau employees at the Center of Economic Studies. We thank Chinhui Juhn and Kevin Murphy for providing the March CPS data, Erica Groshen for providing the January 1977 CPS supplement, and Barry Hirsch for providing much of the union data. We also thank Tim Dunne, Larry Katz, Frank Levy, Richard Murnane, Robert Topel, and the participants of the December 1990 Micro BPEA conference and workshops at the University of Chicago and Yale University for helpful comments on earlier drafts. Scott Schuh provided exceptionally able research assistance. We gratefully acknowledge research support provided by the National Science Foundation, a Joint Statistical Agreement between the Census Bureau and the University of Maryland, and the Graduate School of Business at the University of Chicago. 115 116 Brookings Papers: Microeconomics 1991 Survey (CPS) to estimate the between-plant and within-plant components of overall wage dispersion.1

Performed without pulmonary arterial catheterization, iodinated contrast media, or ionizing radiation, pulmonary MR angiography had a high accuracy for depicting lobar and segmental emboli, but was unable to depict four of five subsegmental emboli.