Working on the Train? The Role of Technical Progress and Trade in Explaining Wage Differentials in Italian Firms
AbstractThis paper presents firm-level evidence on the dynamics of the relative demand for non-manufacturing workers in Italian manufacturing during the 1990s. The analysis provides a number of interesting results. First, the rise within firms in the share of non-manual workers in both employment and hours worked (within-firm skill upgrading) is the main determinant of the increase in the relative demand for skilled workers. By contrast, demand changes associated to trade have mitigated such a rise by shifting employment away from skill-intensive firms. Second, while the relative number of hours worked by skilled workers within firms has risen, the hourly wage premium has fallen. Third, within-firm skill upgrading is strongly and significantly related to investment in computers and R&D. Fourth, we find that technical progress has raised the relative productivity of skilled workers (the skill-bias of technical progress is positive). Finally we show that the standard approach that measures annual, rather than hourly relative wages, produces a downward bias in the estimate of the skill-bias of technical progress.
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Bibliographic InfoPaper provided by IGIER (Innocenzo Gasparini Institute for Economic Research), Bocconi University in its series Working Papers with number 242.
Date of creation: 2003
Date of revision:
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Other versions of this item:
- Paolo Manasse & Luca Stanca, 2003. "Working on the Train? The Role of Technical Progress and Trade in Explaining Wage Differentials in Italian Firms," Development Working Papers 177, Centro Studi Luca d\'Agliano, University of Milano.
- F1 - International Economics - - Trade
- F16 - International Economics - - Trade - - - Trade and Labor Market Interactions
- J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
- O3 - Economic Development, Technological Change, and Growth - - Technological Change; Research and Development; Intellectual Property Rights
This paper has been announced in the following NEP Reports:
- NEP-ALL-2003-09-08 (All new papers)
- NEP-EEC-2003-09-08 (European Economics)
- NEP-LAB-2003-09-08 (Labour Economics)
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- Iranzo, Susana & Schivardi, Fabiano & Tosetti, Elisa, 2006.
"Skill Dispersion and Firm Productivity: An Analysis with Employer-Employee Matched Data,"
CEPR Discussion Papers
5539, C.E.P.R. Discussion Papers.
- Susana Iranzo & Fabiano Schivardi & Elisa Tosetti, 2008. "Skill Dispersion and Firm Productivity: An Analysis with Employer-Employee Matched Data," Journal of Labor Economics, University of Chicago Press, vol. 26(2), pages 247-285, 04.
- Susanna Iranzo & Fabiano Schivardi & Elisa Tosetti, 2006. "Skill dispersion and firm productivity; an analysis with employer-employee matched data," Temi di discussione (Economic working papers) 577, Bank of Italy, Economic Research and International Relations Area.
- S. Iranzo & F. Schivardi & E. Tosetti, 2006. "Skill dispersion and firm productivity: an analysis with employer-employee matched data," Working Paper CRENoS 200617, Centre for North South Economic Research, University of Cagliari and Sassari, Sardinia.
- Francesco Serti & Chiara Tomasi & Antonello Zanfei, 2008.
"Exporters, Importers and Two-way traders: The links between internationalization, skills and wage,"
LEM Papers Series
2008/05, Laboratory of Economics and Management (LEM), Sant'Anna School of Advanced Studies, Pisa, Italy.
- Francesco Serti & Chiara Tomasi & Antonello Zanfei, 2007. "Exporters, Importers and Two-way Traders: the Links between Internationalization, Skills and Wages," Working Papers 0713, University of Urbino Carlo Bo, Department of Economics, Society & Politics - Scientific Committee - L. Stefanini & G. Travaglini, revised 2007.
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