IDEAS home Printed from https://ideas.repec.org/a/fip/fednep/y1995ijanp48-53nv.1.no.1.html

Macroeconomic implications of shifts in the relative demand for skills

Author

Listed:
  • Olivier Jean Blanchard

Abstract

Besides widening wage inequality, if the demand for skills continues to increase it will probably reduce aggregate employment. Policy measures to offset the impact of increased demand for skills on wage inequality and employment would be very costly. Moreover, given local funding of primary and secondary education a sufficiently large supply response cannot be assumed.

Suggested Citation

  • Olivier Jean Blanchard, 1995. "Macroeconomic implications of shifts in the relative demand for skills," Economic Policy Review, Federal Reserve Bank of New York, issue Jan, pages 48-53.
    • Handle: RePEc:fip:fednep:y:1995:i:jan:p:48-53:n:v.1.no.1
    as

    Download full text from publisher

    File URL: https://www.newyorkfed.org/medialibrary/media/research/epr/95v01n1/9501blan.pdf
    Download Restriction: no
    File URL: https://www.newyorkfed.org/medialibrary/media/research/epr/95v01n1/9501blan.html
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Lawrence F. Katz & Kevin M. Murphy, 1992. "Changes in Relative Wages, 1963–1987: Supply and Demand Factors," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 107(1), pages 35-78.
    2. Chinhui Juhn & Kevin M. Murphy & Robert H. Topel, 1991. "Why Has the Natural Rate of Unemployment Increased over Time?," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 22(2), pages 75-142.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Berthold, Norbert & Fehn, Rainer, 1999. "Aggressive Lohnpolitik, überschießende Kapitalintensität und steigende Arbeitslosigkeit: können Investivlöhne für Abhilfe sorgen?," Discussion Paper Series 28, Julius Maximilian University of Würzburg, Chair of Economic Order and Social Policy.
    2. Kuhelika De & Ryan A. Compton & Daniel C. Giedeman & Gary A. Hoover, 2021. "Macroeconomic shocks and racial labor market differences," Southern Economic Journal, John Wiley & Sons, vol. 88(2), pages 680-704, October.
    3. Patricia Couto & Clara Brenck, 2023. "Monetary Policy and the Gender and Racial Employment Dynamics in Brazil," Economics Working Paper Archive wp_1016, Levy Economics Institute.
    4. Angelo Siddi, 2002. "L'evoluzione della divisione del lavoro in Italia nellÕepoca della new," Moneta e Credito, Economia civile, vol. 55(220), pages 387-413.
    5. Louis-Philippe Rochon & Guillaume Vallet, 2022. "The institutions of the people, by the people and for the people? Addressing central banks' power and social responsibility in a democracy," PSL Quarterly Review, Economia civile, vol. 75(301), pages 83-102.
    6. Don Bredin & Stilianos Fountas & Paraskevi Tzika, 2026. "Economic Policy Uncertainty and Income Inequality across Europe," Discussion Paper Series 2026_05, Department of Economics, University of Macedonia, revised May 2026.
    7. Hyunwoo Kim, 2023. "The microfoundation of macroeconomic populism: The effects of economic inequality on public inflation aversion," Economics and Politics, Wiley Blackwell, vol. 35(1), pages 65-96, March.
    8. Elissa Braunstein, 2013. "Central bank policy and gender," Chapters, in: Deborah M. Figart & Tonia L. Warnecke (ed.), Handbook of Research on Gender and Economic Life, chapter 21, pages 345-358, Edward Elgar Publishing.
    9. Willem Thorebeck, 1998. "The Distributional Effects of Disinflationary Monetary Policy," Macroeconomics 9812002, University Library of Munich, Germany.
    10. Klaus Waelde, 1996. "Lifetime learning, biased technological change and the evolution of wages in the U.S. 1960 - 1990," Labor and Demography 9601001, University Library of Munich, Germany.
    11. David A. Brauer, 1995. "Using regional variation to explain widening earnings differentials by educational attainment," Research Paper 9521, Federal Reserve Bank of New York.
    12. Norbert Berthold & Rainer Fehn & Eric Thode, 2002. "Falling Labor Share and Rising Unemployment: Long–Run Consequences of Institutional Shocks?," German Economic Review, Verein für Socialpolitik, vol. 3(4), pages 431-459, November.
    13. Nittai Bergman & Benjamin Born & David A. Matsa & Michael Weber, 2022. "Inclusive Monetary Policy: How Tight Labor Markets Facilitate Broad-Based Employment Growth," NBER Working Papers 29651, National Bureau of Economic Research, Inc.
    14. Kuhelika De & Ryan A. Compton & Daniel C. Giedeman & Gary A. Hoover, 2019. "Macroeconomic Shocks and Racial Labour Market Differences in the U.S," CESifo Working Paper Series 8004, CESifo.
    15. Thorbecke, Willem, 2001. "Estimating the effects of disinflationary monetary policy on minorities," Journal of Policy Modeling, Elsevier, vol. 23(1), pages 51-66, January.
    16. Albert, Juan-Francisco & Gómez-Fernández, Nerea, 2024. "The impact of monetary policy shocks on net worth and consumption across races in the United States," Economic Systems, Elsevier, vol. 48(1).
    17. Willem Thorbeck, 1997. "Disinflationary Monetary Policy and the Distribution of Income," Macroeconomics 9711008, University Library of Munich, Germany.
    18. Willem Thorbecke, 1997. "Disinflationary Monetary Policy and the Distribution of Income," Economics Working Paper Archive wp_185, Levy Economics Institute.
    19. Albert, Juan-Francisco & Peñalver, Antonio & Perez-Bernabeu, Alberto, 2020. "The effects of monetary policy on income and wealth inequality in the U.S. Exploring different channels," Structural Change and Economic Dynamics, Elsevier, vol. 55(C), pages 88-106.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Pinghui Wu, 2022. "Wage Inequality and the Rise in Labor Force Exit: The Case of US Prime-Age Men," Working Papers 22-16, Federal Reserve Bank of Boston.
    2. Gould, Eric D & Moav, Omer & Weinberg, Bruce A, 2001. "Precautionary Demand for Education, Inequality, and Technological Progress," Journal of Economic Growth, Springer, vol. 6(4), pages 285-315, December.
    3. John V. Winters, 2013. "Human capital externalities and employment differences across metropolitan areas of the USA," Journal of Economic Geography, Oxford University Press, vol. 13(5), pages 799-822, September.
    4. Harry J. Holzer, 1998. "Employer Skill Demands and Labor Market Outcomes of Blacks and Women," ILR Review, Cornell University, ILR School, vol. 52(1), pages 82-98, October.
    5. Juhn, Chinhui & Murphy, Kevin M, 1997. "Wage Inequality and Family Labor Supply," Journal of Labor Economics, University of Chicago Press, vol. 15(1), pages 72-97, January.
    6. Ariel J. Binder & John Bound, 2019. "The Declining Labor Market Prospects of Less-Educated Men," Journal of Economic Perspectives, American Economic Association, vol. 33(2), pages 163-190, Spring.
    7. Jørgen Elmeskov, 1993. "High and Persistent Unemployment: Assessment of the Problem and Its Causes," OECD Economics Department Working Papers 132, OECD Publishing.
    8. Jonathan Heathcote & Fabrizio Perri & Gianluca Violante, 2020. "The Rise of US Earnings Inequality: Does the Cycle Drive the Trend?," Review of Economic Dynamics, Elsevier for the Society for Economic Dynamics, vol. 37, pages 181-204, August.
    9. Lawrence F Katz, 1998. "Reflections on US Labour Market Performance," RBA Annual Conference Volume (Discontinued), in: Guy Debelle & Jeff Borland (ed.),Unemployment and the Australian Labour Market, Reserve Bank of Australia.
    10. Kevin M. Murphy & Robert H. Topel, 2016. "Human Capital Investment, Inequality, and Economic Growth," Journal of Labor Economics, University of Chicago Press, vol. 34(S2), pages 99-127.
    11. Mukoyama, Toshihiko & Sahin, Aysegl, 2009. "Why did the average duration of unemployment become so much longer?," Journal of Monetary Economics, Elsevier, vol. 56(2), pages 200-209, March.
    12. Hesham ABDEL-RAHMAN, 2010. "Trade, Urban Systems, and Labor Markets," Regional and Urban Modeling 284100000, EcoMod.
    13. Nekoei, Arash, 2022. "The measurement of labor supply using March CPS: A cautionary tale," Economics Letters, Elsevier, vol. 216(C).
    14. Freeman, Richard B., 1998. "War of the models: Which labour market institutions for the 21st century?1," Labour Economics, Elsevier, vol. 5(1), pages 1-24, March.
    15. repec:eee:labchp:v:3:y:1999:i:pc:p:3143-3259 is not listed on IDEAS
    16. Ottaviano, Gianmarco & Peri, Giovanni, 2008. "Immigration and National Wages: Clarifying the Theory and the Empirics," CEPR Discussion Papers 6916, Centre for Economic Policy Research.
    17. Krause, M.U., 2002. "Inter-Industry Wage Differentials and Job Flows," Discussion Paper 2002-3, Tilburg University, Center for Economic Research.
    18. Francine D. Blau & Lawrence Kahn, 1995. "The Gender Earnings Gap: Some International Evidence," NBER Chapters, in: Differences and Changes in Wage Structures, pages 105-144, National Bureau of Economic Research, Inc.
    19. Ouedraogo, Benoît & Ouedraogo, Idrissa & Sawadogo, Hamidou, 2025. "Effects of trade openness on income inequality in sub-Saharan Africa: direct effects and transmission channels," International Economics, Elsevier, vol. 184(C).
    20. Jaime Arellano-Bover & Carolina Bussotti & Matteo Paradisi & Liangjie Wu, 2026. "The Labor Demand Implications of Brand Capital: Evidence from Trademark Transactions," RFBerlin Discussion Paper Series 26079, ROCKWOOL Foundation Berlin (RFBerlin).
    21. Davoine, Thomas & Mankart, Jochen, 2017. "Changes in education, wage inequality and working hours over time," Discussion Papers 38/2017, Deutsche Bundesbank.

    More about this item

    Keywords

    ;
    ;
    ;

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:fip:fednep:y:1995:i:jan:p:48-53:n:v.1.no.1. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Gabriella Bucciarelli (email available below). General contact details of provider: https://edirc.repec.org/data/frbnyus.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.