Technological Change and Wages: An Inter-Industry Analysis

51 Pages Posted: 30 Jun 2000 Last revised: 5 Oct 2010

See all articles by Ann P. Bartel

Ann P. Bartel

Columbia Business School - Finance and Economics; National Bureau of Economic Research (NBER)

Nachum Sicherman

Columbia University; IZA Institute of Labor Economics

Multiple version iconThere are 2 versions of this paper

Date Written: February 1997

Abstract

Previous research has found evidence that wages in industries characterized as high tech,' or subject to higher rates of technological change, are higher. In addition, there is evidence that skill-biased technological change is responsible for the dramatic increase in the earnings of more educated workers relative to less educated workers that took place during the 1980s. In this paper, we match a variety of industry level measures of technological change to a panel of young workers observed between 1979 and 1993 (NLSY) and examine the role played by unobserved heterogeneity in explaining the positive relationships between technological change and wages, and between technological change and the education premium. We find evidence that the wage premium associated with technological change is primarily due to the sorting of better workers into those industries. In addition, the education premium associated with technological change is found to be the result of an increase in demand for the innate ability or other observable characteristics of more educated workers.

Suggested Citation

Bartel, Ann P. and Sicherman, Nachum, Technological Change and Wages: An Inter-Industry Analysis (February 1997). NBER Working Paper No. w5941. Available at SSRN: https://ssrn.com/abstract=225722

Ann P. Bartel (Contact Author)

Columbia Business School - Finance and Economics ( email )

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National Bureau of Economic Research (NBER)

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Nachum Sicherman

Columbia University ( email )

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New York, NY 10027
United States
212-854-4464 (Phone)
212-316-9355 (Fax)

IZA Institute of Labor Economics

P.O. Box 7240
Bonn, D-53072
Germany

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