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The Medium Is the Measure: Technical Change and Employment, 1909—1949

Author

Listed:
  • Michelle Alexopoulos

    (University of Toronto)

  • Jon Cohen

    (University of Toronto)

Abstract

New indicators, based on technology titles, are used to measure the impact of innovative activity on the U.S. labor market between 1909 and 1949. We find that positive technology shocks raised productivity, employment, vacancies, and labor turnover and lowered unemployment and business failures. Moreover, automotive and electrical innovations (quintessential general-purpose technologies) had a greater positive impact on employment than those in mechanical innovations. The overall results, compatible with the predictions of the real business cycle model, raise questions about the anemic recovery in employment after 1934 since the strong upsurge in technical change failed to be accompanied by vigorous job expansion.

Suggested Citation

  • Michelle Alexopoulos & Jon Cohen, 2016. "The Medium Is the Measure: Technical Change and Employment, 1909—1949," The Review of Economics and Statistics, MIT Press, vol. 98(4), pages 792-810, October.
    • Handle: RePEc:tpr:restat:v:98:y:2016:i:4:p:792-810
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    Cited by:

    1. Manav Raj & Robert Seamans, 2018. "Artificial Intelligence, Labor, Productivity, and the Need for Firm-Level Data," NBER Chapters, in: The Economics of Artificial Intelligence: An Agenda, pages 553-565, National Bureau of Economic Research, Inc.
    2. David Autor & Anna Salomons, 2018. "Is Automation Labor Share–Displacing? Productivity Growth, Employment, and the Labor Share," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 49(1 (Spring), pages 1-87.
    3. Jayes, Jonathan & Molinder, Jakob & Enflo, Kerstin, 2025. "Power for progress: The impact of electricity on individual labor market outcomes," Explorations in Economic History, Elsevier, vol. 98(C).
    4. Khanna, Rupika & Sharma, Chandan, 2022. "Impact of information technology on firm performance: New evidence from Indian manufacturing," Information Economics and Policy, Elsevier, vol. 60(C).
    5. Wu, Xuehui & Wu, Zhong & Hu, Jun, 2022. "Global competitiveness analysis of industrial robot technology innovations market layout using visibility graph," Physica A: Statistical Mechanics and its Applications, Elsevier, vol. 603(C).
    6. Sergio Petralia, 2020. "GPTs and Growth: Evidence on the Technological Adoption of Electrical & Electronic Technologies in the 1920s," Papers in Evolutionary Economic Geography (PEEG) 2033, Utrecht University, Department of Human Geography and Spatial Planning, Group Economic Geography, revised Aug 2020.
    7. Calza, Elisa & Lavopa, Alejandro & Ligia Zagato, 2022. "Advanced digital technologies and industrial resilience during the COVID-19 pandemic: A firm-level perspective," MERIT Working Papers 2022-008, United Nations University - Maastricht Economic and Social Research Institute on Innovation and Technology (MERIT).
    8. Qiao, Yi & Li, Xiaorong & Hu, Juncheng, 2025. "From digital to innovative: How does digital transformation affect corporate innovation?," Economics Letters, Elsevier, vol. 247(C).
    9. Gaggl, Paul & Gray, Rowena & Marinescu, Ioana & Morin, Miguel, 2021. "Does electricity drive structural transformation? Evidence from the United States," Labour Economics, Elsevier, vol. 68(C).
    10. Peng Liang & Xinhui Sun, 2024. "Does digital transformation promote the green innovation of China’s listed companies?," Environment, Development and Sustainability: A Multidisciplinary Approach to the Theory and Practice of Sustainable Development, Springer, vol. 26(9), pages 22199-22235, September.
    11. Li, Yanqiong & Zhang, Linlang, 2025. "Intelligent manufacturing and the pay gap within firms," International Review of Financial Analysis, Elsevier, vol. 106(C).
    12. Michelle Alexopoulos & Jon Cohen, 2024. "Tracking technical change: Past, present and future," Canadian Journal of Economics/Revue canadienne d'économique, John Wiley & Sons, vol. 57(4), pages 1047-1087, November.
    13. Ding, Xiangan & Appolloni, Andrea & Shahzad, Mohsin & Liu, Yue & Han, Shaojie, 2025. "Digital transformation and total factor productivity in manufacturing firms: Evidence of corporate public responsibilities in China," Technology in Society, Elsevier, vol. 82(C).
    14. Xiangan Ding & Zhonglin Sheng & Andrea Appolloni & Mohsin Shahzad & Shaojie Han, 2024. "Digital transformation, ESG practice, and total factor productivity," Business Strategy and the Environment, Wiley Blackwell, vol. 33(5), pages 4547-4561, July.
    15. Hao, Shiming, 2021. "True structure change, spurious treatment effect? A novel approach to disentangle treatment effects from structure changes," MPRA Paper 108679, University Library of Munich, Germany.
    16. repec:nbr:nberch:14019 is not listed on IDEAS
    17. Xue, Kunkun & Cui, Ziyi & Sun, Zepeng & Sun, Peipei, 2026. "Does digital technology increase the labor income share of enterprises?," Technological Forecasting and Social Change, Elsevier, vol. 222(C).
    18. repec:bin:bpeajo:v:49:y:2019:i:2018-01:p:1-87 is not listed on IDEAS

    More about this item

    JEL classification:

    • E3 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles
    • O3 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights
    • O4 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity
    • N1 - Economic History - - Macroeconomics and Monetary Economics; Industrial Structure; Growth; Fluctuations

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