Is College Education Still Enough? Explicating the Relationship between Information Technology and Human Labor

Posted: 4 Jun 2020

See all articles by Dawei (David) Zhang

Dawei (David) Zhang

Lehigh University

Gang Peng

California State University Fullerton, Mihaylo College of Business & Economics

Yuliang Oliver Yao

Lehigh University

Tyson R. Browning

Neeley School of Business, TCU

Date Written: May 6, 2020

Abstract

Many believe that information technology (IT) substitutes for human labor in work processes; others believe that a college degree might protect employees from tech-related job loss. This study finds that college education may not be sufficient to prevent the substitution, and that the substitution/complementarity relationship between IT and labor depends on the education levels of the employees and the tasks to be performed. We examine the IT-labor relationship using an industry-level dataset covering 60 U.S. industries from 1998 to 2013. We adopt the elasticity of substitution and the organizational complementarity approaches to examine this substitution/complementarity relationship between IT and labor with different education levels. Our findings indicate that, since the late 1990s, workers with college education have become substitutes to IT investment, and graduate education has been increasingly required to benefit from the massive adoption of IT by U.S. industries.

Keywords: information technology, human labor, college education, IT investment, elasticity of substitution

Suggested Citation

Zhang, Dawei (David) and Peng, Gang and Yao, Yuliang and Browning, Tyson R., Is College Education Still Enough? Explicating the Relationship between Information Technology and Human Labor (May 6, 2020). Available at SSRN: https://ssrn.com/abstract=3593926

Dawei (David) Zhang (Contact Author)

Lehigh University ( email )

621 Taylor Street
Bethlehem, PA 18015
United States

Gang Peng

California State University Fullerton, Mihaylo College of Business & Economics ( email )

2550 Nutwood Ave
Fullerton, CA 92831
United States

Yuliang Yao

Lehigh University ( email )

621 Taylor Street
Bethlehem, PA 18015
United States

Tyson R. Browning

Neeley School of Business, TCU ( email )

Fort Worth, TX 76129
United States

HOME PAGE: http://www.TysonBrowning.com

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