This paper examines the extent to which patterns of human capital convergence can account for observed patterns of income inequality between countries. To do this I decompose national income into three components: one due to education levels, one reflecting the return to education, and a residual component. I then examine in turn the contribution of each of them to changes in income dispersion. Among the developed countries, convergence in education levels has resulted in a reduction in income dispersion. However, for the world as a whole, incomes have diverged despite substantial convergence in education levels. This is a result of increases in the return to education that favor the developed countries at the expense of the less developed countries.

This article examines the long‐run effects of the Restart unemployment program in the United Kingdom. The program, aimed at the long‐term unemployed, involved a combination of tighter monitoring of benefit eligibility rules and increased job search assistance. We compare the employment behavior of a treatment group who participated in the scheme with that of a randomly chosen control group for whom participation was delayed. While there is little evidence of a long‐term benefit for women, the unemployment rate among males in the treatment group was six percentage points lower than that of the control group 5 years after the initial experiment.