Technical Change, Inequality, and the Labor Market

Daron Acemoglu

No 7800, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: This essay discusses the effect of technical change on wage inequality. I argue that the behavior of wages and returns to schooling indicates that technical change has been skill-biased during the past sixty years. Furthermore, the recent increase in inequality is most likely due to an acceleration in skill bias. In contrast to twentieth century developments, most technical change during the nineteenth century appears to be skill-replacing. I suggest that this is because the increased supply of unskilled workers in the English cities made the introduction of these technologies profitable. On the other hand, the twentieth-century has been characterized by skill-biased technical change because the rapid increase in the supply of skilled workers has induced the development of skill-complementary technologies. The recent acceleration in skill bias is in turn likely to have been a response to the acceleration in the supply of skills during the past several decades.

JEL-codes: J30 J31 (search for similar items in EconPapers)
Date: 2000-07
New Economics Papers: this item is included in nep-lab and nep-tid
Note: LS EFG
References: Add references at CitEc
Citations: View citations in EconPapers (115)

Published as Acemoglu, Daron. "Technical Change, Inequality, And The Labor Market," Journal of Economic Literature, 2002, v40(1,Mar), 7-72.

Downloads: (external link)
http://www.nber.org/papers/w7800.pdf (application/pdf)

Related works:
Journal Article: Technical Change, Inequality, and the Labor Market (2002)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:nbr:nberwo:7800

Ordering information: This working paper can be ordered from
http://www.nber.org/papers/w7800

Access Statistics for this paper

More papers in NBER Working Papers from National Bureau of Economic Research, Inc National Bureau of Economic Research, 1050 Massachusetts Avenue Cambridge, MA 02138, U.S.A.. Contact information at EDIRC.
Bibliographic data for series maintained by ().