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Organizational change, new information and communication technologies and the demand for labor in services

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Author Info
Falk, Martin

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Abstract

Between 1993 and 1995, the majority of German firms in services introduced new organizational practices (OC), in particular total quality management systems, certified ISO 9000, lean administration, flatter hierarchies, delegation of authority and ICT-enabled organizational changes). This paper analyzes the impact of organizational change as well as the impact of the introduction of information and communication technology (ICT) on actual labor demand as well as on employment expectations. The focus of attention is also directed to potential endogeneity of OC using treatment effect models as well as multivariate probit models. The empirical results suggest that OC has a positive effect on actual employment growth given output and factor price changes. Furthermore, we find that organizational change has a positive impact on expected employment for all skill groups except for unskilled labor. New ICT and the share of training expenditures are primary forces behind OC. Finally, employment effects are robust to endogeneity of organizational change. --

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Publisher Info
Paper provided by ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research in its series ZEW Discussion Papers with number 01-25.

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Date of creation: 2001
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Handle: RePEc:zbw:zewdip:5380

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Related research
Keywords: organizational change; ICT; skill structure;

Find related papers by JEL classification:
O33 - Economic Development, Technological Change, and Growth - - Technological Change - - - Technological Change: Choices and Consequences; Diffusion Processes
J23 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Demand

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  1. Timothy F. Bresnahan & Erik Brynjolfsson & Lorin M. Hitt, 1999. "Information Technology, Workplace Organization and the Demand for Skilled Labor: Firm-Level Evidence," NBER Working Papers 7136, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
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  2. Paul Osterman, 2000. "Work reorganization in an era of restructuring: Trends in diffusion and effects on employee welfare," Industrial and Labor Relations Review, ILR Review, ILR School, Cornell University, vol. 53(2), pages 179-196, January.
  3. Bartel, Ann P & Lichtenberg, Frank R, 1987. "The Comparative Advantage of Educated Workers in Implementing New Technology," The Review of Economics and Statistics, MIT Press, vol. 69(1), pages 1-11, February. [Downloadable!] (restricted)
  4. Doms, Mark & Dunne, Timothy & Troske, Kenneth R, 1997. "Workers, Wages, and Technology," The Quarterly Journal of Economics, MIT Press, vol. 112(1), pages 253-90, February.
  5. Caroli, Eve & Greenan, Nathalie & Guellec, Dominique, 2001. "Organizational Change and Skill Accumulation," Industrial and Corporate Change, Oxford University Press, vol. 10(2), pages 481-506, June.
  6. Breslaw, Jon A. & McIntosh, James, 1998. "Simulated latent variable estimation of models with ordered categorical data," Journal of Econometrics, Elsevier, vol. 87(1), pages 25-47, August. [Downloadable!] (restricted)
  7. Eve Caroli & John Van Reenen, 2001. "Skill-Biased Organizational Change? Evidence From A Panel Of British And French Establishments," The Quarterly Journal of Economics, MIT Press, vol. 116(4), pages 1449-1492, November. [Downloadable!] (restricted)
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  8. Timothy F. Bresnahan, 1997. "Computerization and Wage Dispersion: An Analytical Reinterpretation," Working Papers 97031, Stanford University, Department of Economics. [Downloadable!]
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  9. Casey Ichniowski & Kathryn Shaw & Giovanna Prennushi, 1995. "The Effects of Human Resource Management Practices on Productivity," NBER Working Papers 5333, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
  10. Lisa M. Lynch & Sandra E. Black, 1995. "Beyond the Incidence of Training: Evidence from a National Employers Survey," NBER Working Papers 5231, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
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  1. Hempell, Thomas, 2003. "Do Computers Call for Training? : Firm-level Evidence on Complementarities Between ICT and Human Capital Investments," ZEW Discussion Papers 03-20, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research. [Downloadable!]
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