Productivity Measurement And The Impact Of Trade And Technology On Wages: Estimates For The U.S., 1972-1990
We develop an empirical framework to assess the importance of trade and technical change on the wages of production and nonproduction workers. Trade is measured by the foreign outsourcing of intermediate inputs, while technical change is measured by the shift towards high-technology capital such as computers. In our benchmark specification, we find that both foreign outsourcing and expenditures of high-technology equipment can explain a substantial amount of the increase in the wages of nonproduction (high-skilled) relative to production (low-skilled) workers that occurred during the 1980s. Surprisingly, it is expenditures on high-technology capital other than computers that are important. These results are very sensitive, however, to our benchmark assumption that industry prices are independent of productivity. When we allow for the endogeneity of industry prices, then expenditures on computers becomes the most important cause of the increased wage inequality, and have a 50% greater impact than does foreign outsourcing.
|Date of creation:||09 Jan 2003|
|Date of revision:|
|Contact details of provider:|| Postal: |
Phone: (530) 752-0741
Fax: (530) 752-9382
Web page: http://www.econ.ucdavis.edu
More information through EDIRC
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- David Autor & Lawrence Katz & Alan Krueger, 1997.
"Computing Inequality: Have Computers Changed the Labor Market?,"
756, Princeton University, Department of Economics, Industrial Relations Section..
- David H. Autor & Lawrence F. Katz & Alan B. Krueger, 1998. "Computing Inequality: Have Computers Changed The Labor Market?," The Quarterly Journal of Economics, MIT Press, vol. 113(4), pages 1169-1213, November.
- David H. Autor & Lawrence F. Katz & Alan B. Krueger, 1997. "Computing Inequality: Have Computers Changed the Labor Market?," NBER Working Papers 5956, National Bureau of Economic Research, Inc.
- Eric J. Bartelsman & Wayne Gray, 1996. "The NBER Manufacturing Productivity Database," NBER Technical Working Papers 0205, National Bureau of Economic Research, Inc.
- Ernst R. Berndt & Catherine J. Morrison & Larry S. Rosenblum, 1992.
"High-Tech Capital Formation and Labor Composition in U.S. Manufacturing Industries: An Exploratory Analysis,"
NBER Working Papers
4010, National Bureau of Economic Research, Inc.
- Berndt, Ernst R. & Morrison, Catherine J. & Rosenblum, Larry S., 1992. "High-tech capital formation and labor composition in U.S. manufacturing industries : an exploratory analysis," Working papers 3414-92., Massachusetts Institute of Technology (MIT), Sloan School of Management.
- Baldwin, Robert E & Cain, Glen C, 1997.
"Shifts in US Relative Wages: The Role of Trade, Technology and Factor Endowments,"
CEPR Discussion Papers
1596, C.E.P.R. Discussion Papers.
- R. E. Baldwin & G. G. Cain, . "Shifts in U.S. Relative Wages: The Role of Trade, Technology, and Factor Endowments," Institute for Research on Poverty Discussion Papers 1132-97, University of Wisconsin Institute for Research on Poverty.
- Robert E. Baldwin & Glen G. Cain, 1997. "Shifts in U.S. Relative Wages: The Role of Trade, Technology and Factor Endowments," NBER Working Papers 5934, National Bureau of Economic Research, Inc.
- Baldwin, Robert E & Hilton, R Spence, 1984. "A Technique for Indicating Comparative Costs and Predicting Changes in Trade Ratios," The Review of Economics and Statistics, MIT Press, vol. 66(1), pages 105-10, February.
- Martin Neil Baily & Robert J. Gordon, 1988. "The Productivity Slowdown, Measurement Issues, and the Explosion of Computer Power," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 19(2), pages 347-432.
- Berman, Eli & Bound, John & Griliches, Zvi, 1994. "Changes in the Demand for Skilled Labor within U.S. Manufacturing: Evidence from the Annual Survey of Manufactures," The Quarterly Journal of Economics, MIT Press, vol. 109(2), pages 367-97, May.
- Berndt, Ernst R. & Morrison, Catherine J., 1992.
"High-tech capital formation and economic performance in U.S. manufacturing industries : an exploratory analysis,"
3419-92., Massachusetts Institute of Technology (MIT), Sloan School of Management.
- Berndt, Ernst R. & Morrison, Catherine J., 1995. "High-tech capital formation and economic performance in U.S. manufacturing industries An exploratory analysis," Journal of Econometrics, Elsevier, vol. 65(1), pages 9-43, January.
When requesting a correction, please mention this item's handle: RePEc:cda:wpaper:97-17. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Scott Dyer)
If references are entirely missing, you can add them using this form.