This file is part of IDEAS, which uses RePEc data


[ Papers | Articles | Software | Books | Chapters | Authors | Institutions | JEL Classification | NEP reports | Search | New papers by email | Author registration | Rankings | Volunteers | FAQ | Blog | Help! ]

The Effects of Technical Change on Labor Market Inequalities

In: Handbook of Economic Growth

Author info | Abstract | Publisher info | Download info | Related research | Statistics
Author Info
Hornstein, Andreas
Krusell, Per
Violante, Giovanni L.

Additional information is available for the following registered author(s):

Abstract

In this chapter we inspect economic mechanisms through which technological progress shapes the degree of inequality among workers in the labor market. A key focus is on the rise of U.S. wage inequality over the past 30 years. However, we also pay attention to how Europe did not experience changes in wage inequality but instead saw a sharp increase in unemployment and an increased labor share of income, variables that remained stable in the U.S. We hypothesize that these changes in labor market inequalities can be accounted for by the wave of capital-embodied technological change, which we also document. We propose a variety of mechanisms based on how technology increases the returns to education, ability, experience, and "luck" in the labor market. We also discuss how the wage distribution may have been indirectly influenced by technical change through changes in certain aspects of the organization of work, such as the hierarchical structure of firms, the extent of unionization, and the degree of centralization of bargaining. To account for the U.S.-Europe differences, we use a theory based on institutional differences between the United States and Europe, along with a common acceleration of technical change. Finally, we briefly comment on the implications of labor market inequalities for welfare and for economic policy.

Download Info
To download:

If you experience problems downloading a file, check if you have the proper application to view it first. Information about this may be contained in the File-Format links below. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.

File URL: http://www.sciencedirect.com/science/article/B7P5F-4HP4N1N-9/2/23b7f57f1582f5e64d0420e8973058da
File Format:
File Function:
Download Restriction: Full text for ScienceDirect subscribers only

As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.

Publisher Info
Download reference. The following formats are available: HTML (with abstract), plain text (with abstract), BibTeX, RIS (EndNote, RefMan, ProCite), ReDIF
This chapter was published in: Philippe Aghion & Steven Durlauf (ed.) Handbook of Economic Growth, , chapter 20, pages 1275-1370, 2005.

This item is provided by Elsevier in its series Handbook of Economic Growth with number 1-20.

Handle: RePEc:eee:grochp:1-20

Contact details of provider:
Web page: http://www.elsevier.com/wps/find/bookseriesdescription.cws_home/BS_HE/description

For technical questions regarding this item, or to correct its listing, contact: (Heidi Boesdal).

Related research
This chapter was published in the following book, which is listed on IDEAS:
Philippe Aghion & Steven Durlauf (ed.), 2005. "Handbook of Economic Growth," Handbook of Economic Growth, Elsevier, edition 1, volume 1, number 1, September. [Downloadable!] (restricted)
Keywords:

Other versions of this item:

Find related papers by JEL classification:
O0 - Economic Development, Technological Change, and Growth - - General

Cited by:
(explanations, Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.)

  1. Heski Bar-Isaac & Ian Jewitt & Clare Leaver, 2007. "Information and Human Capital Managment," Working Papers 07-29, New York University, Leonard N. Stern School of Business, Department of Economics. [Downloadable!]
    Other versions:
  2. Ansgar Belke & Thorsten Polleit & Kai Geisslreither, 2006. "Nobelpreis für Wirtschaftswissenschaften 2006 an Edmund S. Phelps," Diskussionspapiere aus dem Institut für Volkswirtschaftslehre der Universität Hohenheim 278/2005, Department of Economics, University of Hohenheim, Germany. [Downloadable!]
  3. Heathcote, Jonathan & Storesletten, Kjetil & Violante, Giovanni L, 2005. "Insurance and Opportunities: The Welfare Implications of Rising Wage Dispersion," CEPR Discussion Papers 5200, C.E.P.R. Discussion Papers. [Downloadable!] (restricted)
    Other versions:
  4. Gene M. Grossman & Esteban Rossi-Hansberg, 2006. "The rise of offshoring: it's not wine for cloth anymore," Proceedings, Federal Reserve Bank of Kansas City, pages 59-102. [Downloadable!]
  5. Hans Fehr & Sabine Jokisch & Laurence J. Kotlikoff, 2008. "Dynamic Globalization and Its Potentially Alarming Prospects for Low-Wage Workers," NBER Working Papers 14527, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
    Other versions:
  6. Hervé Boulhol & Sabien Dobbelaere & Sara Maioli, 2009. "Imports as Product and Labour Market Discipline," Tinbergen Institute Discussion Papers 09-002/3, Tinbergen Institute. [Downloadable!]
    Other versions:
  7. Donghoon Lee & Kenneth I. Wolpin, 2005. "Accounting for Wage and Employment Changes in the U. S. from 1968-2000: A Dynamic Model of Labor Market Equilibrium," PIER Working Paper Archive 06-005, Penn Institute for Economic Research, Department of Economics, University of Pennsylvania, revised 02 Jan 2006. [Downloadable!]
    Other versions:
  8. Simone Bertoli & Francesco Farina, 2007. "The functional distribution of income: a review of the theoretical literature and of the empirical evidence around its recent pattern in European countries," Department of Economic Policy, Finance and Development (DEPFID) University of Siena 005, Department of Economic Policy, Finance and Development (DEPFID), University of Siena. [Downloadable!]
  9. Volker Grossmann & Thomas M. Steger, 2007. "Growth, Development, and Technological Change," IZA Discussion Papers 2558, Institute for the Study of Labor (IZA). [Downloadable!]
    Other versions:
  10. Dhingra, Swati, 2006. "Reconciling Observed Tariffs and the Median Voter Model," MPRA Paper 892, University Library of Munich, Germany, revised 31 Jul 2007. [Downloadable!]
  11. Claudio Michelacci & Josep Pijoan-Mas, 2007. "The Effects Of Labor Market Conditions On Working Time: The Us-Eu Experience," Working Papers wp2007_0705, CEMFI. [Downloadable!]
    Other versions:
  12. Katsunori Yamada, 2005. "Public versus Private Education in an Endogenous Growth Model with Social Status," Economics Bulletin, Economics Bulletin, vol. 15(11), pages 1-9. [Downloadable!]
  13. Jonathan Heathcote & Kjetil Storesletten & Giovanni L. Violante, 2007. "Insurance and Opportunities: A Welfare Analysis of Labor Market Risk," NBER Working Papers 13673, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
    Other versions:
  14. Cozzi, Guido & Impullitti, Giammario, 2006. "Technological policy and wage inequality," MPRA Paper 10140, University Library of Munich, Germany. [Downloadable!]
  15. Mika Maliranta & Satu Nurmi & Hanna Virtanen, 2008. "It takes three to tango in employment: Matching vocational education organisations, students and companies in labour market," Economics of Education Working Paper Series 0022, University of Zurich, Institute for Strategy and Business Economics (ISU). [Downloadable!]
  16. Cecilia García-Peñalosa, 2008. "Inequality and growth: Goal conflict or necessary prerequisite?," Working Papers 147, Oesterreichische Nationalbank (Austrian Central Bank). [Downloadable!]
  17. Jonathan Heathcote & Kjetil Storesletten & Giovanni L. Violante, 2008. "The Macroeconomic Implications of Rising Wage Inequality in the United States," NBER Working Papers 14052, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
    Other versions:
  18. Guido Cozzi & Giammario Impullitti, 2008. "Government spending composition, technical change and wage inequality," Working Papers 2009_02, Department of Economics, University of Glasgow. [Downloadable!]
  19. Luis Garicano & Esteban Rossi-Hansberg, 2005. "Organization and Inequality in a Knowledge Economy," NBER Working Papers 11458, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
    Other versions:
Statistics
Access and download statistics

Did you know? There are NEP reports in over 80 fields that deliver new research to your email.

This page was last updated on 2009-11-26.

This information is provided to you by IDEAS at the Department of Economics, College of Liberal Arts and Sciences, University of Connecticut using RePEc data on a server sponsored by the Society for Economic Dynamics.