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The Returns to Pencil Use Revisited

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  • Alexandra Spitz-Oener

Abstract

Many researchers believe that the observed positive association between computer use and wages simply reflects unobserved heterogeneity: like pencils and other "white-collar" tools, computers are assigned to employees who possess productive attributes that would attract higher wages in any event. This study evaluates that claim by identifying the mechanisms through which computers changed the wage structure in West Germany in the late 1990s. The author finds that the spread of computers---but not of pencils---shifted the task composition of occupations toward analytical and interactive tasks that are complementary to computers' capabilities, and away from routine cognitive and manual tasks for which computers tend to substitute. Employees possessing computer-complementary skills enjoyed wage increases because computers both raised the demand for their skills and increased their marginal product. The estimates suggest that computer use, ceteris paribus, was associated with a wage premium of 8-15%.

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Bibliographic Info

Article provided by ILR Review, Cornell University, ILR School in its journal ILR Review.

Volume (Year): 61 (2008)
Issue (Month): 4 (July)
Pages: 502-517

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Handle: RePEc:ilr:articl:v:61:y:2008:i:4:p:502-517

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Cited by:
  1. Katja Görlitz & Marcus Tamm, 2012. "Revisiting the Complementarity between Education and Training: The Role of Personality, Working Tasks and Firm Effects," SOEPpapers on Multidisciplinary Panel Data Research 477, DIW Berlin, The German Socio-Economic Panel (SOEP).
  2. Nathalie Chusseau & Michel Dumont, 2012. "Growing income inequalities in advanced countries," Working Papers 260, ECINEQ, Society for the Study of Economic Inequality.
  3. Regula Geel & Uschi Backes-Gellner, 2009. "Occupational Mobility Within and Between Skill Clusters: An Empirical Analysis Based on the Skill-Weights Approach," Economics of Education Working Paper Series, University of Zurich, Institute for Strategy and Business Economics (ISU) 0047, University of Zurich, Institute for Strategy and Business Economics (ISU).
  4. Nathalie Chusseau & Michel Dumont, 2012. "Growing Income Inequalities in Advanced," Working Papers hal-00993359, HAL.

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