Claudia Goldin and Lawrence Katz have been pioneers in the economic history of American education, and this book represents a summation of their research to date. Although much of the work has appeared before in articles and working papers, here the authors present an ambitious unified interpretation of more than a century of U.S. experience, along the lines suggested by the title, culminating in policy advice for restoring the country's former status as world educational leader.

Although U.S. leadership in primary education dates from the mid-nineteenth century, the distinctive Goldin-Katz narrative begins with the “high school movement” of the first half of the twentieth century (chapters 5 and 6). This was a grass-roots phenomenon, propelled by what the authors call the “virtues” of U.S. educational institutions: public funding, public provision, decentralization, openness and forgivingness, gender neutrality, and the separation of church and state. Though largely localist in its origins, mass secondary education was vital to U.S. economic leadership during this same period, because it facilitated adoption and improvement of twentieth-century technologies. Diffusion of the high school norm was largely complete by 1950 (outside of the South), but this formula for American economic success was extended for another generation by the rise of mass higher education after World War II. Thus, the correspondence between the American century and the human-capital century was, the authors argue, not at all coincidental (pp. 41–43).

This much seems reasonably familiar from previous Goldin-Katz publications. A new element here is the finding that the pace of educational progress declined sharply after 1980, and that this disruption has been the critical factor explaining the rise of inequality since then. Formally, this result emerges from a supply-demand framework (pp. 293–96) and hence may be sensitive to the authors' assumptions about specification and measurement. However, an important role for the educational supply-side in rising inequality seems eminently plausible, since even the raw data show an abrupt end to the long-term rise of high school graduation rates, well short of 80 percent (p. 331). College-going rates continued to increase, but college completion rates also declined (p. 326). In addition to the slowdown in the quantity of educational attainment, the relative quality of U.S. schooling seems to have declined as well. Changes in school quality do not fit well into Goldin and Katz's supply-demand framework, but the deterioration is documented in the book and in the studies cited (pp. 325, 328, 348).

Given the importance of this historical break for the book's analysis, it comes as something of a letdown that the authors do not pinpoint a clear explanation for it. Instead, a multiplicity of suspects are identified: rising college tuition rates (p. 276); loss of local control, particularly through equalization rulings by the courts, beginning with the 1971 Serrano-Priest decision in California (p. 339); reopening of church-state issues (pp. 341–43); the increase in poor and single-parent households (p. 349); and immigration, which is assigned a compositional but not fundamental role (pp. 333–35). Curiously missing from the list is the tax revolt initiated by Proposition 13, passed by California voters in 1978, which rolled property taxes back to 1972 levels and limited their growth thereafter. Judicial equalization may have threatened high-spending districts, but it was the interaction between Serrano and Prop. 13 that eviscerated local control and decimated school spending. California's role thus shifted from educational pacesetter to inspiration for antitax forces throughout the country.

Does this list of setbacks constitute merely a series of unlucky shocks for American schools, or was a larger historical process at work? The book does not say. Part of the difficulty may be that in the authors' supply-demand framework, institutions appear only as “rigidities and alterations” for rationalizing deviations from the model (p. 293), not as an integral part of the narrative. Hence, if institutions have failed in some way, the model does not tell us why. But to be fair, understanding such a dramatic break in U.S. educational history is indeed a challenge. Goldin and Katz deserve credit for placing these issues onto the agenda of economic historians, and one hopes that others will follow their lead by exploring alternative interpretations for these developments.

The Race Between Education and Technology takes a strong position in favor of skill-biased technological change as the dominant force in the growth of education. As good historians, the authors acknowledge that new technologies do not always display this bias, noting that the nineteenth-century pattern differed, and that computers and software “have obviated the need for certain abilities and traits” (p. 93). They maintain, however, that “the pace of skill-biased technical change has remained rather stable for over a century” (p. 121), and that this bias accounts for “the lion's share of rising wage inequality” since 1980 (p. 291). In taking this stance, Goldin and Katz dismiss the traditions in economic history that attempt to endogenize technological bias over extended periods, formalized by Daron Acemoglu as “directed technical change” and extensively discussed at the 2008 Economic History Association meetings (Daron Acemoglu, “Why Do New Technologies Complement Skills? Directed Technical Change and Wage Inequality.” Quarterly Journal of Economics 113 (1998): 1055–89).

These differences may not matter much for earlier parts of the narrative, since the close linkage between educational standards and job qualifications down to the 1970s is readily rationalized under both perspectives. But the authors' strong position for recent decades is puzzling in light of the evidence presented by David H. Autor, Katz, and Melissa S. Kearney on the “polarization” of the U.S. labor market after 1990, specifically the adverse impact of computerization on the demand for “middle skilled” routine cognitive and manual tasks (David H. Autor, Lawrence F. Katz, and Melissa S. Kearney, “The Polarization of the U.S. Labor Market.” American Economic Review 96 (2006): 189–94; and “Trends in U.S. Wage Inequality: Revising the Revisionists.” Review of Economics and Statistics 90 (2008): 300–23). Goldin and Katz do cite this research, and note that it “would appear to be at odds with the skill-biased technological change explanation” (p. 302). But they downplay the inconsistency, on the grounds that demand for graduates of “more selective institutions” and post-BA programs have remained strong.

At the very least, this evidence calls into question the notion of long-term stability in technological bias.

Perhaps this discussion mainly serves to illustrate the general proposition that economic history becomes more difficult to write, the closer we come to the present. Goldin and Katz deserve applause for boldly carrying their narrative into modern times. Their analysis will set the standard for future work, in what we may hope becomes a burgeoning new subfield for our discipline.