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Importing Skill-Biased Technology

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  • Ariel Burstein
  • Javier Cravino
  • Jonathan Vogel

Abstract

The production of capital equipment is concentrated among a small group of countries, and many countries import a large share of their equipment. If capital-skill complementarity is an important feature of technology, international trade may have important effects on the skill premium through its impact on equipment accumulation. In this paper we propose a tractable framework for evaluating this effect, provide simple analytic expressions linking observable changes in import shares by sector to changes in real wages of skilled and unskilled workers (and, therefore, the skill premium), and quantify the importance of this effect for a large set of countries. (JEL E22, F11, F16, J24, L64)

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File URL: http://www.aeaweb.org/articles.php?doi=10.1257/mac.5.2.32
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Bibliographic Info

Article provided by American Economic Association in its journal American Economic Journal: Macroeconomics.

Volume (Year): 5 (2013)
Issue (Month): 2 (April)
Pages: 32-71

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Handle: RePEc:aea:aejmac:v:5:y:2013:i:2:p:32-71

Note: DOI: 10.1257/mac.5.2.32
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References

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Citations

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Cited by:
  1. Arnaud Costinot & Andrés Rodríguez-Clare, 2013. "Trade Theory with Numbers: Quantifying the Consequences of Globalization," NBER Working Papers 18896, National Bureau of Economic Research, Inc.
  2. Ariel Burstein & Jonathan Vogel, 2011. "Factor Prices and International Trade: A Unifying Perspective," NBER Working Papers 16904, National Bureau of Economic Research, Inc.
  3. Alberto Behar, 2013. "The Endogenous Skill Bias of Technical Change and Inequality in Developing Countries," IMF Working Papers 13/50, International Monetary Fund.

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