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Technical Change and the Wage Structure During the Second Industrial Revolution: Evidence from the Merchant Marine, 1865-1912

  • Chinhui Juhn


    (Department of Economics, University of Houston)

  • Aimee Chin


    (Department of Economics, University of Houston)

  • Peter Thompson


    (Department of Economics, Florida International University)

Using a large, individual-level wage data set, we examine the impact of a major technological innovation—the steam engine—on skill demand and the wage structure in the merchant shipping industry. We find that the technical change created a new demand for skilled workers, the engineers, while destroying demand for workers with skills relevant only to sail. It had a deskilling effect on production work—able-bodied seamen (essentially, artisans) were replaced by unskilled engine room operatives. On the other hand, mates and able-bodied seamen employed on steam earned a premium relative to their counterparts on sail. A wholesale switch from sail to steam would increase the 90/10 wage ratio by 40%, with most of the rise in inequality coming from the creation of the engineer occupation.

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Paper provided by Department of Economics, University of Houston in its series Working Papers with number 2004-03.

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Length: 49 pages
Date of creation: Aug 2004
Date of revision:
Handle: RePEc:hou:wpaper:2004-03
Contact details of provider: Postal: Houston TX 77023
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  12. Juhn, Chinhui & Murphy, Kevin M & Pierce, Brooks, 1993. "Wage Inequality and the Rise in Returns to Skill," Journal of Political Economy, University of Chicago Press, vol. 101(3), pages 410-42, June.
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  21. repec:fth:starer:9816 is not listed on IDEAS
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