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Changes in the Functional Structure of Firms and the Demand for Skill

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  • Maurin, Eric
  • Thesmar, David

Abstract

We describe and analyse the changes in the occupational structure of French manufacturing firms between 1984 and 1995. Firms employ a much greater proportions of engineers and researchers working on the design and marketing of new products and a much lower proportion of high-skilled experts working in administration-related activities. Firms have also reduced the share of production-related activities at both the levels of high-skilled and low-skilled workers. We develop a very simple labour demand model that shows the role played by technological change. By reducing the costs of activities that are the easiest to program in advance (notably for product fabrication), new information technologies make it possible to allocate more human and material resources to the activities that are the most difficult to program in advance, notably for the conception and marketing of new products. We show that this is the main channel through which new information technologies increase the demand for skill.

Suggested Citation

  • Maurin, Eric & Thesmar, David, 2003. "Changes in the Functional Structure of Firms and the Demand for Skill," CEPR Discussion Papers 3831, C.E.P.R. Discussion Papers.
  • Handle: RePEc:cpr:ceprdp:3831
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    References listed on IDEAS

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    Cited by:

    1. Eric Maurin & David Thesmar, 2004. "Changes in the Functional Structure of Firms and the Demand for Skill," Journal of Labor Economics, University of Chicago Press, vol. 22(3), pages 639-664, July.
    2. Cheron, Arnaud & Langot, François & Moreno-Galbis, Eva, 2007. "The dynamic of job competition during the ICT revolution," CEPREMAP Working Papers (Docweb) 0702, CEPREMAP.
    3. James Harrigan & Ariell Reshef & Farid Toubal, 2016. "The March of the Techies: Technology, Trade, and Job Polarization in France, 1994-2007," Working Papers 2016-15, CEPII research center.
    4. Yesim Ucdogruk, 2006. "Employment Impact of Product and Process Innovations in Turkey," Ege Academic Review, Ege University Faculty of Economics and Administrative Sciences, vol. 6(1), pages 87-99.
    5. Givord, Pauline & Maurin, Eric, 2003. "Job Tenure, Wages and Technology: A Reassessment Using Matched Worker-Firm Panel Data," CEPR Discussion Papers 4147, C.E.P.R. Discussion Papers.
    6. 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.
    7. Moreno-Galbis, Eva & Sopraseuth, Thepthida, 2014. "Job polarization in aging economies," Labour Economics, Elsevier, vol. 27(C), pages 44-55.
    8. David, Benjamin, 2017. "Computer technology and probable job destructions in Japan: An evaluation," Journal of the Japanese and International Economies, Elsevier, vol. 43(C), pages 77-87.
    9. Cörvers, Frank & Dupuy, Arnaud, 2010. "Estimating employment dynamics across occupations and sectors of industry," Journal of Macroeconomics, Elsevier, vol. 32(1), pages 17-27, March.
    10. Carlos Henrique Corseuil & Hidehiko Ichimura, 2006. "New Evidences on What Job Creation and Job Destruction Represent," Discussion papers 06023, Research Institute of Economy, Trade and Industry (RIETI).
    11. Pierre-Jean Messe & Eva Moreno-Galbis & François-Charles Wolf, 2014. "Retirement intentions in the presence of technological change: Theory and evidence from France," TEPP Working Paper 2014-04, TEPP.
    12. Givord, Pauline & Maurin, Eric, 2004. "Changes in job security and their causes: An empirical analysis for France, 1982-2002," European Economic Review, Elsevier, vol. 48(3), pages 595-615, June.
    13. repec:hal:journl:halshs-00118808 is not listed on IDEAS
    14. Michael Mesch, 2007. "Die Berufsstruktur der Beschäftigung in Wien 1991-2001," Wirtschaft und Gesellschaft - WuG, Kammer für Arbeiter und Angestellte für Wien, Abteilung Wirtschaftswissenschaft und Statistik, vol. 33(1), pages 41-72.
    15. Defever, Fabrice, 2006. "Functional fragmentation and the location of multinational firms in the enlarged Europe," Regional Science and Urban Economics, Elsevier, vol. 36(5), pages 658-677, September.
    16. W. Smits, 2006. "The Quality of Apprenticeship Training," Education Economics, Taylor & Francis Journals, vol. 14(3), pages 329-344.
    17. Wouter Dessein & Tano Santos, 2003. "The Demand for Coordination," NBER Working Papers 10056, National Bureau of Economic Research, Inc.
    18. DiPrete, Thomas A. & Goux, Dominique & Maurin, Eric & Quesnel-Vallée, Amélie, 2003. "Work and pay in flexible and regulated labor markets: A generalized perspective on institutional evolution and inequality trends in Europe and the US," Discussion Papers, Research Unit: Labor Market Policy and Employment SP I 2003-109, Social Science Research Center Berlin (WZB).
    19. Benjamin David, 2014. "Contribution of ICT on Labor Market Polarization: an Evolutionary Approach," EconomiX Working Papers 2014-25, University of Paris Nanterre, EconomiX.
    20. Martine Carre & David Drouot, 2004. "Pace versus Type: The Effect of Economic Growth on Unemployment and Wage Patterns," Review of Economic Dynamics, Elsevier for the Society for Economic Dynamics, vol. 7(3), pages 737-757, July.
    21. Benjamin David, 2015. "Computer technology and probable job destructions in Japan: an evaluation," EconomiX Working Papers 2015-28, University of Paris Nanterre, EconomiX.

    More about this item

    Keywords

    skill; tasks; technological change;

    JEL classification:

    • D23 - Microeconomics - - Production and Organizations - - - Organizational Behavior; Transaction Costs; Property Rights
    • J23 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Demand
    • O33 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Technological Change: Choices and Consequences; Diffusion Processes

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