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The Impact of Technological Change on Older Workers: Evidence from Data on Computers

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  • Friedberg, Leora

Abstract

This paper explores the impact on older workers of new technologies that change skill requirements. Older workers, with older skills and less skills than prime-age workers, will suffer in comparison. Furthermore, if skill acquisition is costly, older workers have less incentive to acquire new skills because they have a shorter time horizon until retirement. Several data sets show that the rate of computer use is surprisingly flat over most ages but declines for the oldest workers. The evolution of computer use suggests that most workers, old or young, learn to use computers as needed, and further that older workers use computers less not because they are old, but because they are nearing retirement. In turn, we might expect older workers who do not use computers to retire sooner. In the Health and Retirement Survey non-computer users were 25% more likely to leave work between 1992 and 1996. Instrumental variables estimates, which aim to control for the impact of retirement plans on computer use, do not yield conclusive results, but they suggest that computer use lowers the retirement probability, especially for 55-59 year olds.

Suggested Citation

  • Friedberg, Leora, 1999. "The Impact of Technological Change on Older Workers: Evidence from Data on Computers," University of California at San Diego, Economics Working Paper Series qt1s97n77x, Department of Economics, UC San Diego.
  • Handle: RePEc:cdl:ucsdec:qt1s97n77x
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    References listed on IDEAS

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    Cited by:

    1. Leora Friedberg, 2003. "The Impact of Technological Change on Older Workers: Evidence from Data on Computer Use," ILR Review, Cornell University, ILR School, vol. 56(3), pages 511-529, April.
    2. Hugo Benitez-Silva, 2001. "A Dynamic Model of Job Search Behavior over the Life Cycle with Empirical Applications," Computing in Economics and Finance 2001 100, Society for Computational Economics.
    3. Jeff Borland, 2000. "Economic Explanations of Earnings Distribution Trends in the International Literature and Application to New Zealand," Treasury Working Paper Series 00/16, New Zealand Treasury.
    4. Hugo Benitez-Silva, 2000. "Micro Determinants of Labor Force Status Among Older Americans," Department of Economics Working Papers 00-07, Stony Brook University, Department of Economics.
    5. Weinberg, Bruce A., 2004. "Experience and Technology Adoption," IZA Discussion Papers 1051, Institute for the Study of Labor (IZA).

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    older workers;

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