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Skill Supply and Biased technical change

  • Patricia Crifo

    (Department of Economics, Ecole Polytechnique - Polytechnique - X - CNRS)

This article contributes to the debate on skill-biased technical change by studying the dynamics of skill supply and wage inequality in an endogenous growth model with ability-biased technical progress. Due to a discouragement effect, rising within groups inequality reduces incentives to become educated for ordinary-ability workers. This mechanism generates a non-monotonic relationship between the growth rate and skill supply driving wage inequality upward during periods of accelerating technical change. This theoretical explanation is consistent with the apparent negative relationship between the relative skill supply and premium in the 1970s and 1980s in major OECD countries.

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File URL: https://hal.archives-ouvertes.fr/hal-00243031/document
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Paper provided by HAL in its series Post-Print with number hal-00243031.

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Date of creation: 2008
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Publication status: Published in Labour Economics, Elsevier, 2008, 15, pp.818-830. <10.1016/j.labeco.2007.07.002>
Handle: RePEc:hal:journl:hal-00243031
DOI: 10.1016/j.labeco.2007.07.002
Note: View the original document on HAL open archive server: https://hal.archives-ouvertes.fr/hal-00243031
Contact details of provider: Web page: https://hal.archives-ouvertes.fr/

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  1. Eli Berman & John Bound & Stephen Machin, 1997. "Implications of Skill-Biased Technological Change: International Evidence," Boston University - Institute for Economic Development 78, Boston University, Institute for Economic Development.
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  31. repec:adr:anecst:y:1996:i:44:p:03 is not listed on IDEAS
  32. Patricia Crifo-Tillet & Etienne Lehmann, 2004. "Why Will Technical Change Not Be Permanently Skill-Biased?," Review of Economic Dynamics, Elsevier for the Society for Economic Dynamics, vol. 7(1), pages 157-180, January.
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