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Factor Supplies and the Direction of Technical Change

Author

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  • Svaleryd, Helena

    (The Research Institute of Industrial Economics)

  • Vlachos, Jonas

    (The Research Institute of Industrial Economics)

Abstract

In this paper, we empirically address the hypothesis that there is a relationship between the supply of human capital and the rate and direction of skill-biased technical change (SBTC). Using country- and industry-level data on OECD countries, we find R&D to be positively related to the supply of human capital. There is, however, no indication that this translates into higher rates of SBTC, when SBTC is measured as changes in the wage bill share of skilled labor. Interestingly, both R&D and the rate of SBTC seem to be relatively high in low-skill industries in countries where the supply of human capital is relatively high.

Suggested Citation

  • Svaleryd, Helena & Vlachos, Jonas, 2005. "Factor Supplies and the Direction of Technical Change," Working Paper Series 640, Research Institute of Industrial Economics.
    • Handle: RePEc:hhs:iuiwop:0640
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    References listed on IDEAS

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    More about this item

    Keywords

    Skilled-biased Technical Change; Supply of Human Capital;

    JEL classification:

    • J32 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Nonwage Labor Costs and Benefits; Retirement Plans; Private Pensions
    • O31 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Innovation and Invention: Processes and Incentives

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