Technological Change and Wages: An Inter-Industry Analysis

Ann P. Bartel and Nachum Sicherman

No 5941, NBER Working Papers from National Bureau of Economic Research, Inc

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.

JEL-codes: J24 J31 (search for similar items in EconPapers)
Date: 1997-02
Note: LS
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Citations: View citations in EconPapers (13)

Published as Journal of Political Economy, Vol. 107, no. 2 (April 1999): 285-325.

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Journal Article: Technological Change and Wages: An Interindustry Analysis (1999)
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