IDEAS home Printed from https://ideas.repec.org/a/taf/applec/v34y2002i5p617-635.html

Trade and technological explanations for changes in sectoral labour demand in OECD economies

Author

Listed:
  • Gerry Boyle
  • Pauline McCormack

Abstract

This paper sets out to establish the main determinants of variations in the demand for aggregate labour in manufacturing and service sectors (22) for a cross-section of OECD countries (14). A relatively new panel data set is employed in the analysis, the OECD's International Sectoral Data Base. Preliminary analysis revealed that the 'within' sector variation in the wage share dominated overall variation for most countries and time periods. A separate dynamic model was thus generated to explain the 'within' sector variation in the wage share. This model contained real wages, output, the capital stock, technological change (total factor productivity) and trade (the imports to value-added ratio) as independent variables. In addition the wage level was also interacted with these explanatory variables on the presumption that skill is positively correlated with the level of wages. Because of the potential for simultaneity bias, estimation was conducted by IV and OLS. The main findings were that the capital stock and technological change were the main determinants of shifts in labour demand. While some countries reported the trade variable as significant its influence was only of slight importance in most cases. The interaction terms proved to be significant in a large number of countries. Some evidence was found that capital and technological were complementary with skill. Overall it was found that broad agreement existed across countries in the factors which influence labour demand despite considerable differences in the cross-country nature of labour market institutions.

Suggested Citation

  • Gerry Boyle & Pauline McCormack, 2002. "Trade and technological explanations for changes in sectoral labour demand in OECD economies," Applied Economics, Taylor & Francis Journals, vol. 34(5), pages 617-635.
    • Handle: RePEc:taf:applec:v:34:y:2002:i:5:p:617-635
    DOI: 10.1080/00036840110048474
    as

    Download full text from publisher

    File URL: http://www.tandfonline.com/doi/abs/10.1080/00036840110048474
    Download Restriction: Access to full text is restricted to subscribers.
    File URL: https://libkey.io/10.1080/00036840110048474?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to

    for a different version of it.

    References listed on IDEAS

    as
    1. Machin, Steve & Van Reenen, John, 1996. "Technology and Changes in Skill Structure: Evidence from an International Panel of Industries," CEPR Discussion Papers 1434, Centre for Economic Policy Research.
    2. Steiner, Viktor & Wagner, Kersten, 1997. "Relative Earnings and the Demand for Unskilled Labor in West German Manufacturing," ZEW Discussion Papers 97-17, ZEW - Leibniz Centre for European Economic Research.
    3. Matthew J. Slaughter, 1997. "International Trade and Labor-Demand Elasticities," NBER Working Papers 6262, National Bureau of Economic Research, Inc.
    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. Asier Minondo & Gloria Rubert, 2006. "The effect of outsourcing on the demand for skills in the Spanish manufacturing industry," Applied Economics Letters, Taylor & Francis Journals, vol. 13(9), pages 599-604.
    2. Kang-Shik Choi & Jinook Jeong, 2007. "Does unmeasured ability explain the wage premium associated with technological change?: Quantile regression analysis," Applied Economics, Taylor & Francis Journals, vol. 39(9), pages 1163-1171.
    3. Rosario Cervantes & Gerardo Fujii, 2012. "The Mexican trade liberalization process and its net effects on employment: 1988-2004," EconoQuantum, Revista de Economia y Finanzas, Universidad de Guadalajara, Centro Universitario de Ciencias Economico Administrativas, Departamento de Metodos Cuantitativos y Maestria en Economia., vol. 9(2), pages 81-97, Julio-Dic.
    4. Huang, Yuhong, 2024. "Digital transformation of enterprises: Job creation or job destruction?," Technological Forecasting and Social Change, Elsevier, vol. 208(C).
    5. Kerstin Hotte & Melline Somers & Angelos Theodorakopoulos, 2022. "Technology and jobs: A systematic literature review," Papers 2204.01296, arXiv.org.

    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. Gerry Boyle; & Pauline McCormack, 1998. "Trade and Technological Explanations for Changes in Sectoral Labour Demand in OECD Economies," Economics Department Working Paper Series n770598, Department of Economics, National University of Ireland - Maynooth.
    2. Guglielmo Caporale & Mohammad Haq, 2002. "Manufacturing Wage Differentials and Employment in Some Scandinavian Countries, the U.S. and the U.K.: An Analysis of Variance Approach," Empirica, Springer;Austrian Institute for Economic Research;Austrian Economic Association, vol. 29(4), pages 289-304, December.
    3. Diehl, Markus, 1999. "The Impact of International Outsourcing on the Skill Structure of Employment: Empirical Evidence from German Manufacturing Industries," Kiel Working Papers 946, Kiel Institute for the World Economy.
    4. repec:eee:labchp:v:3:y:1999:i:pb:p:2215-2288 is not listed on IDEAS
    5. Falk, Martin & Koebel, Bertrand M., 1997. "The Demand of Heterogeneous Labour in Germany," ZEW Discussion Papers 97-28, ZEW - Leibniz Centre for European Economic Research.
    6. Schimmelpfennig, Axel, 1998. "Skill-biased technical change vs. structural change: Insights from a new view of the structure of an economy," Kiel Working Papers 868, Kiel Institute for the World Economy.
    7. Robert C. Feenstra, 1998. "Integration of Trade and Disintegration of Production in the Global Economy," Journal of Economic Perspectives, American Economic Association, vol. 12(4), pages 31-50, Fall.
    8. Devashish Mitra, 2001. "Trade Liberalization, Labor Markets and Imperfect Competition," Economics Study Area Working Papers 29, East-West Center, Economics Study Area.
    9. Pfeiffer, Friedhelm, 1997. "Human capital and innovation in East and West German manufacturing firms," ZEW Discussion Papers 97-08, ZEW - Leibniz Centre for European Economic Research.
    10. Piva, Mariacristina & Santarelli, Enrico & Vivarelli, Marco, 2005. "The skill bias effect of technological and organisational change: Evidence and policy implications," Research Policy, Elsevier, vol. 34(2), pages 141-157, March.
    11. Guido Friebel & Gerard McCullough & Laura Padilla Angulo, 2014. "Patterns of Restructuring The US Class 1 Railroads from 1984 to 2004," Journal of Transport Economics and Policy, University of Bath, vol. 48(1), pages 115-135, January.
    12. Gregg, Paul & Manning, Alan, 1997. "Skill-biassed change, unemployment and wage inequality," European Economic Review, Elsevier, vol. 41(6), pages 1173-1200, June.
    13. Puhani, Patrick A., 2001. "Wage rigidities in Western Germany? Microeconometric evidence from the 1990s," ZEW Discussion Papers 01-36, ZEW - Leibniz Centre for European Economic Research.
    14. Olivier Bontout & Sébastien Jean, 1998. "Sensibilité des salaires relatifs aux chocs exogènes de commerce international et de progrès technique: une évaluation d'équilibre général," Working Papers 1998-09, CEPII research center.
    15. Martin Falk & Katja Seim, 2001. "The Impact Of Information Technology On High-Skilled Labor In Services: Evidence From Firm-Level Panel Data," Economics of Innovation and New Technology, Taylor & Francis Journals, vol. 10(4), pages 289-323.
    16. Mellander, Erik, 1999. "The multi-dimensional nature of labor demand and skill-biased technical change," Working Paper Series 1999:9, IFAU - Institute for Evaluation of Labour Market and Education Policy.
    17. Leon Bettendorf & Kees Folmer & Egbert Jongen, 2013. "The dog that did not bark: The EITC for single mothers in the Netherlands," CPB Discussion Paper 229.rdf, CPB Netherlands Bureau for Economic Policy Analysis.
    18. Piekkola, Hannu & Haaparanta, Pertti, 1999. "Liquidity Constraints Faced by Firm and Employment," Discussion Papers 695, The Research Institute of the Finnish Economy.
    19. Robert C. Feenstra, 1998. "Integration of Trade and Disintegration of Production in the Global Economy," Journal of Economic Perspectives, American Economic Association, vol. 12(4), pages 31-50, Fall.
    20. Fajnzylber, Pablo & Maloney, William F., 2005. "Labor demand and trade reform in Latin America," Journal of International Economics, Elsevier, vol. 66(2), pages 423-446, July.
    21. Koebel, Bertrand M. & Falk, Martin, 1999. "Curvature conditions and substitution pattern among capital, energy, materials and heterogeneous labour," ZEW Discussion Papers 99-06, ZEW - Leibniz Centre for European Economic Research.

    More about this item

    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:taf:applec:v:34:y:2002:i:5:p:617-635. 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: Chris Longhurst (email available below). General contact details of provider: http://www.tandfonline.com/RAEC20 .

    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.