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Upstairs, Downstairs: Computers And Skills On Two Floors Of A Large Bank

35 Pages Posted: 21 Sep 2001  

David H. Autor

Massachusetts Institute of Technology (MIT) - Department of Economics; National Bureau of Economic Research (NBER); IZA Institute of Labor Economics

Frank S. Levy

Massachusetts Institute of Technology (MIT) - Department of Urban Studies & Planning

Richard J. Murnane

Harvard University - Graduate School of Education; National Bureau of Economic Research (NBER)

Multiple version iconThere are 2 versions of this paper

Date Written: August 2001

Abstract

Many empirical studies document a positive correlation between workplace computerization and the employment of skilled labor in production. Does this mean that computers necessarily substitute for the tasks performed by less educated workers and complement the tasks performed by more educated workers? We explore this question by positing that computerization leads to the automation of tasks that can be fully described in terms of procedural or "rules-based" logic. This process typically leaves many tasks to be performed by humans. Management decisions play a key role - at least in the short run - in determining how these tasks are organized into jobs, with potentially significant implications for skill demands. We illustrate how this conceptual framework helps to interpret the consequences of the introduction of digital check imaging in two back office departments of a large bank. We argue that the model has applicability to many organizations and helps to reconcile differences between the approaches economists and sociologists typically take to studying the consequences of technological changes.

Keywords: Skill biased technological change, computers, banking

JEL Classification: J3, O3

Suggested Citation

Autor, David H. and Levy, Frank S. and Murnane, Richard J., Upstairs, Downstairs: Computers And Skills On Two Floors Of A Large Bank (August 2001). MIT Department of Economics Working Paper No. 00-23. Available at SSRN: https://ssrn.com/abstract=284095 or http://dx.doi.org/10.2139/ssrn.284095

David H. Autor (Contact Author)

Massachusetts Institute of Technology (MIT) - Department of Economics ( email )

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National Bureau of Economic Research (NBER)

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IZA Institute of Labor Economics

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Frank S. Levy

Massachusetts Institute of Technology (MIT) - Department of Urban Studies & Planning ( email )

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HOME PAGE: http://web.mit.edu/flevy/www

Richard J. Murnane

National Bureau of Economic Research (NBER) ( email )

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Harvard University - Graduate School of Education ( email )

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