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Wages, Employment Structure and Employer Size-Wage Premia: Their Relationship to Advanced-Technology Usage at US Manufacturing Establishments

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  • Dunne, Timothy
  • Schmitz, James A, Jr

Abstract

A common theme in the labor economics literature is that use of advanced technology in production requires a skilled and educated workforce. Using a new survey of production processes at U.S. manufacturing plants, we ask whether plants that employ advanced technology require a skilled workforce. We find that plants that use the most advanced technology pay the highest wages and employ the greatest fraction of non-production workers (who are generally regarded as more skilled than production workers). The inclusion in standard wage regressions of variables that indicate the use of advanced technology reduces the size-wage premia by as much as 60 percent for some size categories. Copyright 1995 by The London School of Economics and Political Science.

Suggested Citation

  • Dunne, Timothy & Schmitz, James A, Jr, 1995. "Wages, Employment Structure and Employer Size-Wage Premia: Their Relationship to Advanced-Technology Usage at US Manufacturing Establishments," Economica, London School of Economics and Political Science, vol. 62(245), pages 89-107, February.
  • Handle: RePEc:bla:econom:v:62:y:1995:i:245:p:89-107
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