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Skill-biased technological knowledge without scale effects

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  • Oscar Afonso

Abstract

In the skill-biased technological change literature, the technological-knowledge bias, which drives wage inequality, is determined by the market-size channel. Motivated by the literature on scale effects since Jones (1995a, b), the standard R&D technology is modified so that wage inequality results similarly from the technological-knowledge bias, which is instead induced by the price channel. Thus, by solving the transitional dynamics numerically, it is shown that the recent rise of the skill premium, which is highlighted by, e.g., Acemoglu (2002a), arises from the price-channel effect, complemented with a mechanism that can be called technological-knowledge-absorption effect.

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  • Oscar Afonso, 2006. "Skill-biased technological knowledge without scale effects," Applied Economics, Taylor & Francis Journals, vol. 38(1), pages 13-21.
    • Handle: RePEc:taf:applec:v:38:y:2006:i:1:p:13-21
    DOI: 10.1080/00036840500367625
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    Cited by:

    1. Sochirca, Elena & Gil, Pedro Mazeda & Afonso, Oscar, 2014. "Technology structure and skill structure: Costly investment and complementarity effects quantification," Journal of Macroeconomics, Elsevier, vol. 40(C), pages 172-189.
    2. Oscar Afonso & Pedro Neves & Maria Thompson, 2014. "The skill premium and economic growth with costly investment, complementarities and international technological-knowledge diffusion," The Journal of International Trade & Economic Development, Taylor & Francis Journals, vol. 23(6), pages 878-905, September.
    3. Oscar Afonso, 2010. "Growth And Wage Inequality In A Scale‐Independent Model With R&D And Human‐Capital Accumulation," Manchester School, University of Manchester, vol. 78(2), pages 149-182, March.
    4. Alexandre Almeida & Oscar Afonso, 2010. "SBTC versus trade: testing skill-premia evidence across 25 OECD countries," Applied Economics Letters, Taylor & Francis Journals, vol. 17(15), pages 1497-1501.
    5. Oscar Afonso, 2010. "Non‐Scale Effects Of International Technological‐Knowledge Diffusion On Southern Growth And Wages," The Japanese Economic Review, Japanese Economic Association, vol. 61(3), pages 341-366, September.
    6. Afonso, Oscar & Silva, Armando, 2012. "Non-scale endogenous growth effects of subsidies for exporters," Economic Modelling, Elsevier, vol. 29(4), pages 1248-1257.
    7. Nuno Torres & Óscar Afonso & Isabel Soares, 2017. "Manufacturing Skill-biased Wage Inequality, Natural Resources and Institutions," Review of Development Economics, Wiley Blackwell, vol. 21(4), pages 1-29, November.
    8. Gil, Pedro Mazeda & Gabriel, Susana & Afonso, Oscar, 2020. "Is the skills mismatch important under skill-biased technological change and imperfect substitutability between immigrants and natives?," Economic Modelling, Elsevier, vol. 84(C), pages 38-54.
    9. Afonso, Oscar & Pinho, Mafalda, 2022. "How to reverse a negative asymmetric labor productivity shock in the European Union? A directed technical change analysis with fiscal and monetary policies," Mathematical Social Sciences, Elsevier, vol. 116(C), pages 47-67.
    10. Óscar Afonso & Pedro G. Lima & Tiago Sequeira, 2022. "The effects of automation and lobbying in wage inequality: a directed technical change model with routine and non-routine tasks," Journal of Evolutionary Economics, Springer, vol. 32(5), pages 1467-1497, November.
    11. Oscar Afonso, 2023. "Losers and losses of COVID-19: a directed technical change analysis with fiscal and monetary policies," Economic Change and Restructuring, Springer, vol. 56(3), pages 1777-1821, June.
    12. Sochirca, Elena & Afonso, Óscar & Gil, Pedro Mazeda, 2013. "Technological-knowledge bias and the industrial structure under costly investment and complementarities," Economic Modelling, Elsevier, vol. 32(C), pages 440-451.
    13. Afonso, Óscar & Thompson, Maria, 2011. "Costly investment, complementarities and the skill premium," Economic Modelling, Elsevier, vol. 28(5), pages 2254-2262, September.
    14. Orachos Napasintuwong Artachinda, 2011. "Modeling Directions of Technical Change in Agricultural Sector," Working Papers 201101, Kasetsart University, Department of Agricultural and Resource Economics.
    15. Oscar Afonso & Tiago Sequeira & Derick Almeida, 2023. "Technological knowledge and wages: from skill premium to wage polarization," Journal of Economics, Springer, vol. 140(2), pages 93-119, October.
    16. Afonso, Oscar, 2023. "Inflation, technological-knowledge bias, and wages," Research in Economics, Elsevier, vol. 77(1), pages 91-103.
    17. Toshihiro Okada, 2012. "Wage Inequality, R&D Labor and R&D Productivity," Economics Bulletin, AccessEcon, vol. 32(4), pages 3036-3052.
    18. Afonso, Oscar & Leite, Rui, 2010. "Learning-by-doing, technology-adoption costs and wage inequality," Economic Modelling, Elsevier, vol. 27(5), pages 1069-1078, September.
    19. Afonso, Oscar & Alves, Rui Henrique & Vasconcelos, Paulo B., 2009. "Public deficits and economic growth," Economic Modelling, Elsevier, vol. 26(5), pages 1101-1109, September.
    20. Afonso, Oscar & Gil, Pedro Mazeda, 2013. "Effects of North–South trade on wage inequality and on human-capital accumulation," Economic Modelling, Elsevier, vol. 35(C), pages 481-492.
    21. Oscar Afonso & Ana Catarina Afonso, 2015. "Endogenous Growth Effects of Environmental Policies," Panoeconomicus, Savez ekonomista Vojvodine, Novi Sad, Serbia, vol. 62(5), pages 607-629, December.
    22. Óscar Afonso & Liliana Fonseca & Manuela Magalhães & Paulo B. Vasconcelos, 2021. "Directed technical change and environmental quality," Portuguese Economic Journal, Springer;Instituto Superior de Economia e Gestao, vol. 20(1), pages 71-97, January.

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