Both Sides of the Story: Skill-biased Technological Change, Labour Market Frictions, and Endogenous Two-Sided Heterogeneity
AbstractThis paper presents a stylised framework to examine how skill-biased techÂ¬nological change and labour market frictions affect the relationship between economic expansion and unskilled unemployment. The first part of the analysis focuses on the investment decisions in skill-acquisition and technology adoption activities faced by workers and firms in response to the introduction of an innoÂ¬vative technology. The second part examines how endogenous two-sided heteroÂ¬geneity in the labour market affects the macroeconomic outcomes in terms of unemployment, technological diffusion, and economic expansion. To conclude, the framework is used to discuss the effects of alternative forms of policy interÂ¬vention on agents' investment decisions and on the macroeconomic outcomes.
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Bibliographic InfoPaper provided by Centre for Dynamic Macroeconomic Analysis in its series CDMA Working Paper Series with number 200908.
Date of creation: 15 Sep 2009
Date of revision:
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skill-biased technological change; market frictions; two-sided hetÂ¬erogeneity.;
Other versions of this item:
- Aricó, Fabio R., 2009. "Both Sides of the Story: Skill-biased Technological Change, Labour Market Frictions, and Endogenous Two-Sided Heterogeneity," SIRE Discussion Papers 2009-49, Scottish Institute for Research in Economics (SIRE).
- C78 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Bargaining Theory; Matching Theory
- J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
- J64 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Unemployment: Models, Duration, Incidence, and Job Search
- O33 - Economic Development, Technological Change, and Growth - - Technological Change; Research and Development; Intellectual Property Rights - - - Technological Change: Choices and Consequences; Diffusion Processes
This paper has been announced in the following NEP Reports:
- NEP-ALL-2009-11-07 (All new papers)
- NEP-GTH-2009-11-07 (Game Theory)
- NEP-LAB-2009-11-07 (Labour Economics)
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