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Is there skilled-biased technological change in Italian manufacturing? Evidence from firm-level data

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  • Massimiliano Bratti
  • Nicola Matteucci

Abstract

The bulk of the literature on the Skill-Biased Technological Change (SBTC) hypothesis has focused on the US and the UK, while evidence on other countries is ‘mixed’. We use firm-level data to test for the presence of SBTC in Italian manufacturing. The interest stems from the fact that Italy is a “late comer” country, suffers a gap in new technologies and has a ‘rigid’ labour market. We estimate employment-share equations using as a skill-ratio two alternative measures, the ratio between white collars and blue collars (WC/BC) and that between graduates and non-graduates (G/NG). We find an unconventional evidence supporting SBTC. First, with the most traditional indicator (WC/BC), a significant effect of R&D is only found when the latter is disaggregated by destination: SBTC mainly runs via process-oriented R&D. Instead, a significant impact of R&D on the skill-ratio is always uncovered with G/NG. Further disaggregations confirm that the impact of R&D is mainly due to incremental process-oriented activities. These results can be easily reconciled with the structural characteristics of Italian manufacturing, where traditional sectors and small and medium sized firms prevail, innovative activities are mainly incremental and the capacity to absorb skilled labour rather limited.

Suggested Citation

  • Massimiliano Bratti & Nicola Matteucci, 2005. "Is there skilled-biased technological change in Italian manufacturing? Evidence from firm-level data," Brussels Economic Review, ULB -- Universite Libre de Bruxelles, vol. 48(1-2), pages 153-182.
  • Handle: RePEc:bxr:bxrceb:y:2005:v:48:i:1-2:p:153-182
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    Cited by:

    1. Renato BALDUCCI, 2005. "Public Expenditure and Economic Growth. A critical extension of Barro's (1990) model," Working Papers 240, Universita' Politecnica delle Marche (I), Dipartimento di Scienze Economiche e Sociali.
    2. Michaelsen, Maren M., 2011. "The Hidden Increase in Wage Inequality: Skill-biased and Ability-biased Technological Change," Ruhr Economic Papers 262, RWI - Leibniz-Institut für Wirtschaftsforschung, Ruhr-University Bochum, TU Dortmund University, University of Duisburg-Essen.
    3. Emmanuelle Walkowiak, 2006. "Renouvellement de la main-d'œuvre et modernisation des entreprises," Revue économique, Presses de Sciences-Po, vol. 57(6), pages 1205-1233.
    4. Antonioli, Davide & Manzalini, Rocco & Pini, Paolo, 2011. "Innovation, workers skills and industrial relations: Empirical evidence from firm-level Italian data," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 40(3), pages 312-326, May.
    5. Paolo Naticchioni & Andrea Ricci & Emiliano Rustichelli, 2007. "Wage Structure, Inequality And Skill-Biased Change: Is Italy An Outlier?," Quaderni del Dipartimento di Economia, Finanza e Statistica 38/2007, Università di Perugia, Dipartimento Economia.
    6. Gabriele BALLARINO & Massimiliano BRATTI, 2006. "Fields of study and graduates’ occupational outcomes in Italy during the 90s. Who won and who lost?," Departmental Working Papers 2006-17, Department of Economics, Management and Quantitative Methods at Università degli Studi di Milano.
    7. repec:zbw:rwirep:0262 is not listed on IDEAS
    8. Sami SAAFI & Fouzi SBOUI, 2011. "LES OPPORTUNITES DES INVESTISSEMENTS DIRECTS ETRANGERS LES OPPORTUNITES DES INVESTISSEMENTS DIRECTS ETRANGERS, DIFFUSION TECHNOLOGIQUE ET DEMANDE DE LA MAIN-D’OEUVRE PAR QUALIFICATION DES INDUSTRIES T," Working Papers 240, Laboratoire de Recherche sur l'Industrie et l'Innovation. ULCO / Research Unit on Industry and Innovation.
    9. Paolo Naticchioni & Andrea Ricci & Emiliano Rustichelli, 2008. "Wage Inequality, Employment Structure and Skill-biased Change in Italy," LABOUR, CEIS, vol. 22(s1), pages 27-51, June.
    10. Paolo Seri, 2014. "The role of proximity in retrospective: organizations, ICT and human resources in Italian traditional districts’ firms," Working Papers 1404, University of Urbino Carlo Bo, Department of Economics, Society & Politics - Scientific Committee - L. Stefanini & G. Travaglini, revised 2014.
    11. R. Antonietti & D. Antonioli, 2007. "Conditional Leptokurtosis in Energy Prices: Multivariate Evidence from Futures Markets," Working Papers 594, Dipartimento Scienze Economiche, Universita' di Bologna.
    12. Stefania BUSSOLETTI & Roberto ESPOSTI, 2004. "Regional Convergence, Structural Funds and the Role of Agricolture in the EU. A Panel-Data Approach," Working Papers 220, Universita' Politecnica delle Marche (I), Dipartimento di Scienze Economiche e Sociali.
    13. Maren M. Michaelsen, 2011. "The Hidden Increase in Wage Inequality: Skill-biased and Ability-biased Technological Change," Ruhr Economic Papers 0262, Rheinisch-Westfälisches Institut für Wirtschaftsforschung, Ruhr-Universität Bochum, Universität Dortmund, Universität Duisburg-Essen.
    14. Roberto ESPOSTI & Pierpaolo PIERANI, 2005. "Price, Private Demand and Optimal Provision of Public R&D in Italian Agriculture," Working Papers 238, Universita' Politecnica delle Marche (I), Dipartimento di Scienze Economiche e Sociali.
    15. Chiara BROCCOLINI & Alessia LO TURCO & Andrea PRESBITERO & Stefano STAFFOLANI, 2007. "International Outsourcing vs. ICT in explaining the wage gap in Italian Manufacturing," Working Papers 299, Universita' Politecnica delle Marche (I), Dipartimento di Scienze Economiche e Sociali.

    More about this item

    Keywords

    Firm-level; ICT; Italy; Manufacturing; Skill-biased technological change; R&D;

    JEL classification:

    • J21 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Force and Employment, Size, and Structure
    • L60 - Industrial Organization - - Industry Studies: Manufacturing - - - General
    • O33 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Technological Change: Choices and Consequences; Diffusion Processes

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