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New technology and old institutions: An empirical analysis of the skill-biased demand for older workers in Europe

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  • Peng, Fei
  • Anwar, Sajid
  • Kang, Lili

Abstract

Using panel data from nine European countries over the period 1970 to 2007, we examine the impact of information and communication technology (ICT) on the demand for older workers (aged 50 and over). We find evidence of a decrease in demand for older workers in the 1970s and 1980s. It can be argued that the impact of ICT on demand for older workers is skill-biased. However, the skill-biased demand for older workers is mainly reflected in the skill-biased changes in employment shares rather than relative wages. There is some evidence of a gradual deskilling of older workers. We find that labour market institutions such as the national minimum wage, social pacts on wage issues and union density mostly benefit skilled older workers, while coordination of wage setting, extension of collective agreements, social pacts on pensions and centralisation of wage bargaining can alleviate the adverse effects of skill-biased technological change.

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  • Peng, Fei & Anwar, Sajid & Kang, Lili, 2017. "New technology and old institutions: An empirical analysis of the skill-biased demand for older workers in Europe," Economic Modelling, Elsevier, vol. 64(C), pages 1-19.
  • Handle: RePEc:eee:ecmode:v:64:y:2017:i:c:p:1-19
    DOI: 10.1016/j.econmod.2017.03.004
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    Cited by:

    1. Sameer Khatiwada & Mia Kim Maceda Veloso, 2019. "New Technology and Emerging Occupations: Evidence from Asia," Working Papers id:13039, eSocialSciences.
    2. repec:eee:ecmode:v:68:y:2018:i:c:p:435-449 is not listed on IDEAS

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    Keywords

    Earnings; Older workers; Information and communication technology; Labour market institutions;

    JEL classification:

    • J21 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Force and Employment, Size, and Structure
    • 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

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