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Information and communication technologies and skill upgrading: the role of internal vs external labour markets

Listed author(s):
  • Luc Behaghel
  • Eve Caroli
  • Emmanuelle Walkowiak

Following the adoption of information and communication technologies (ICT), firms are likely to face increasing skill requirements. They may react either by training or hiring the new skills, or by a combination of both. We first show that ICT are indeed skill biased and we then assess the relative importance of external and internal labour market strategies. We show that skill upgrading following ICT adoption takes place mostly through internal labour markets adjustments. The introduction of ICT is associated with an upward shift in firms' occupational structure, of which one third is due to hiring and firing workers from and to the external labour market, whereas two-thirds are due to promotions. Moreover, we find no compelling evidence of external labour market strategies based on excess turnover. In contrast, French firms heavily rely on training in order to upgrade the skill level of their workforce, even if this varies across industries. Copyright 2012 Oxford University Press 2011 All rights reserved, Oxford University Press.

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File URL: http://hdl.handle.net/10.1093/oep/gpr045
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Article provided by Oxford University Press in its journal Oxford Economic Papers.

Volume (Year): 64 (2012)
Issue (Month): 3 (July)
Pages: 490-517

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Handle: RePEc:oup:oxecpp:v:64:y:2012:i:3:p:490-517
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  1. Sandra E. Black & Lisa M. Lynch, 2004. "What's driving the new economy?: the benefits of workplace innovation," Economic Journal, Royal Economic Society, vol. 114(493), pages 97-116, February.
  2. Philippe Askenazy & Eva Moreno Galbis, 2007. "The Impact of Technological and Organizational Changes on Labor Flows. Evidence on French Establishments," LABOUR, CEIS, vol. 21(2), pages 265-301, June.
  3. Alexandra Spitz-Oener, 2006. "Technical Change, Job Tasks, and Rising Educational Demands: Looking outside the Wage Structure," Journal of Labor Economics, University of Chicago Press, vol. 24(2), pages 235-270, April.
  4. Luc Behaghel & Nathalie Greenan, 2005. "Training and Age-Biased Technical Change : Evidence from French Micro Data," Working Papers 2005-06, Center for Research in Economics and Statistics.
  5. 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.
  6. Eve Caroli & John Van Reenen, 2001. "Skill-Biased Organizational Change? Evidence from A Panel of British and French Establishments," The Quarterly Journal of Economics, Oxford University Press, vol. 116(4), pages 1449-1492.
  7. Bauer, Thomas K. & Bender, Stefan, 2004. "Technological change, organizational change, and job turnover," Labour Economics, Elsevier, vol. 11(3), pages 265-291, June.
  8. John M. Abowd & Patrick Corbel & Francis Kramarz, 1999. "The Entry And Exit Of Workers And The Growth Of Employment: An Analysis Of French Establishments," The Review of Economics and Statistics, MIT Press, vol. 81(2), pages 170-187, May.
  9. Luc Behaghel & Fabien Postel-Vinay, 2003. "Insécurité de l'emploi : le rôle protecteur de l'ancienneté a-t-il baissé en France ? Suivi d'un commentaire de Fabien Postel-Vinay," Économie et Statistique, Programme National Persée, vol. 366(1), pages 3-29.
  10. Philippe Zamora, 2006. "Changements organisationnels, technologiques et recours à la formation dans les entreprises industrielles," Revue économique, Presses de Sciences-Po, vol. 57(6), pages 1235-1257.
  11. Bassanini, Andrea & Booth, Alison L. & Brunello, Giorgio & De Paola, Maria & Leuven, Edwin, 2005. "Workplace Training in Europe," IZA Discussion Papers 1640, Institute for the Study of Labor (IZA).
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