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Elasticity of Substitution and Disaggregation of Labor by Skill Level: Empirical Measurement Using a Global Database


  • Das, Gouranga Gopal



The 45 region ´ 50 commodity ´ 5 primary factor version of the Global Trade Analysis Project's [GTAP] database provides us with the splits of total labor payments into skilled and unskilled labor-presupposing substitution possibilities between them. Given the skilled labor payment shares of the GTAP database, we offer an ex post rationalization within a production-theoretic framework. This relies on inter-regional covariation in the GTAP shares and in measures of educational attainment. Adoption of a suitable nesting of skilled-unskilled labor in GTAP's production function enables us to derive a 'reasonable' value for the (implicit) substitution elasticity between skilled-unskilled labors.

Suggested Citation

  • Das, Gouranga Gopal, 2003. "Elasticity of Substitution and Disaggregation of Labor by Skill Level: Empirical Measurement Using a Global Database," Applied Econometrics and International Development, Euro-American Association of Economic Development, vol. 3(1).
  • Handle: RePEc:eaa:aeinde:v:3:y:2003:i:3_4

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    References listed on IDEAS

    1. Nehru, Vikram & Swanson, Eric & Dubey, Ashutosh, 1995. "A new database on human capital stock in developing and industrial countries: Sources, methodology, and results," Journal of Development Economics, Elsevier, vol. 46(2), pages 379-401, April.
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    Cited by:

    1. Das, Gouranga Gopal, 2005. "Information age to genetic revolution: Embodied technology transfer and assimilation — A tale of two technologies," MPRA Paper 37250, University Library of Munich, Germany, revised 2006.
    2. Ricardo Argüello & Daniel Valderrama-Gonzalez, 2015. "Sectoral and poverty impacts of agricultural policy adjustments in Colombia," Agricultural Economics, International Association of Agricultural Economists, vol. 46(2), pages 259-280, March.

    More about this item

    JEL classification:

    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
    • O15 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Economic Development: Human Resources; Human Development; Income Distribution; Migration


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