Skill-Biased Technology Imports, Increased Schooling Access, and Income Inequality in Developing Countries
AbstractWhy has schooling not countered the pervasive rises in wage inequality driven by skill-biased technical change? Using data and a model of directed technical change in which developing countries acquire technology licenses from abroad, we show technological change is skill-biased in the South simply because it is in the North. This causes permanently rising wage inequality in the South. We model expanded schooling access as producing relatively educated new cohorts of labor market entrants. This makes the market for skill-biased technologies more attractive, which generates accelerated skill-biased technical change, which leads to higher wage inequality and possibly stagnant unskilled wages.
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Bibliographic InfoArticle provided by De Gruyter in its journal Journal of Globalization and Development.
Volume (Year): 2 (2012)
Issue (Month): 2 (January)
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Web page: http://www.degruyter.com
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- 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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