Coping with Technological Progress: the Role of Ability in Making Inequality so Persistent

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Coping with Technological Progress: the Role of Ability in Making Inequality so Persistent

Author Info

Rubinstein, Y.
Tsiddon, D.

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Abstract

This study explains the evolution of wage inequality over the last 30 years and supports this explanation with evidence. At each level of schooling, a faster rate of technological progress weakens the link between schooling and work and increases the unknown needed to cope with during one's working life. Coping with the unknown demands ability. By accentuating the role of ability, technological progress increases wage inequality within each group of education as well as between education groups. Inasmuch as education is an irreversible investment, the rise in within group inequality BOOSTS UP the rise of between group inequality. Guided by this theory we turn to the PSID for evidence.

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Publisher Info
Paper provided by Tel Aviv in its series Papers with number 27-98.

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Length: 45 pages
Date of creation: 1998
Date of revision:
Handle: RePEc:fth:teavfo:27-98

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Paper
- Rubinstein, Yona & Tsiddon, Daniel, 1999. "Coping with Technological Progress: The Role of Ability in Making Inequality so Persistent," CEPR Discussion Papers 2153, C.E.P.R. Discussion Papers. [Downloadable!] (restricted)

Find related papers by JEL classification:
D31 - Microeconomics - - Distribution - - - Personal Income and Wealth Distribution
I21 - Health, Education, and Welfare - - Education - - - Analysis of Education
J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
J62 - Labor and Demographic Economics - - Mobility, Unemployment, and Vacancies - - - Job, Occupational and Intergenerational Mobility; Promotion
O40 - Economic Development, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - General
D63 - Microeconomics - - Welfare Economics - - - Equity, Justice, Inequality, and Other Normative Criteria and Measurement

Cited by:
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Hassler, John & Rodriguez Mora, Jose V. & Zeira, Joseph, 2002. "Inequality and Mobility," Working Paper Series rwp02-009, Harvard University, John F. Kennedy School of Government. [Downloadable!]
Other versions:
- Hassler, John & Rodríguez Mora, José Vicente & Zeira, Joseph, 2000. "Inequality and Mobility," CEPR Discussion Papers 2497, C.E.P.R. Discussion Papers. [Downloadable!] (restricted)
- John Hassler & Jose V. Rodriguez Mora & Joseph Zeira, 2007. "Inequality and Mobility," ESE Discussion Papers 165, Edinburgh School of Economics, University of Edinburgh. [Downloadable!]
- John Hassler & José Rodríguez Mora & Joseph Zeira, 2007. "Inequality and mobility," Journal of Economic Growth, Springer, vol. 12(3), pages 235-259, September. [Downloadable!] (restricted)
Peter B. Meyer, 2005. "Turbulence, Inequality, and Cheap Steel," Working Papers 375, U.S. Bureau of Labor Statistics. [Downloadable!]
Daniele Checchi & Giuseppe Bertola, 2001. "Sorting and private education in Italy," Departemental Working Papers 2001-21, Department of Economics University of Milan Italy. [Downloadable!]
Other versions:
- Bertola, Giuseppe & Checchi, Daniele, 2002. "Sorting and Private Education in Italy," CEPR Discussion Papers 3198, C.E.P.R. Discussion Papers. [Downloadable!] (restricted)
Patricia Crifo, 2008. "Skill Supply and Biased technical change," Post-Print hal-00243031_v1, HAL. [Downloadable!]
Other versions:
- Crifo, Patricia, 2008. "Skill supply and biased technical change," Labour Economics, Elsevier, vol. 15(5), pages 812-830, October. [Downloadable!] (restricted)
David B. Audretsch & Mark Sanders, 2008. "Globalization and the Rise of the Entrepreneurial Economy," Working Papers 08-21, Utrecht School of Economics. [Downloadable!]
James Heckman & Edward Vytlacil, 2000. "Identifying the Role of Cognitive Ability in Explaining the Level of and Change in the Return to Schooling," NBER Working Papers 7820, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
Other versions:
- James Heckman & Edward Vytlacil, 2001. "Identifying The Role Of Cognitive Ability In Explaining The Level Of And Change In The Return To Schooling," The Review of Economics and Statistics, MIT Press, vol. 83(1), pages 1-12, February. [Downloadable!] (restricted)

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