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Returns to Computer Use and Organizational Practices of the Firm

  • Dostie, Benoit


    (HEC Montreal)

  • Trépanier, Mathieu


    (Northwestern University)

In this paper, we test the hypothesis that computer use will lead to productivity gains only if the firm uses an appropriate set of organizational practices. Detailed data on organizational practices and workers’ compensation are obtained through a Canadian longitudinal linked employer-employee database called the Workplace and Employee Survey (WES). Linked data allow us to take into account both worker and firm unobserved heterogeneity through the estimation of a linear mixed model of wage determination. Our results suggest a small but positive computer-wage premium whose size is related to a set of organizational practices.

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Paper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 1541.

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Length: 41 pages
Date of creation: Mar 2005
Date of revision:
Handle: RePEc:iza:izadps:dp1541
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  1. John M. Abowd & Francis Kramarz & David N. Margolis, 1994. "High Wage Workers and High Wage Firms," NBER Working Papers 4917, National Bureau of Economic Research, Inc.
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  6. Abowd, John M. & Kramarz, Francis, 1999. "Econometric analyses of linked employer-employee data," Labour Economics, Elsevier, vol. 6(1), pages 53-74, March.
  7. Makepeace, Gerry & Peter Dolton, 2003. "Computer use and earnings in Britain," Royal Economic Society Annual Conference 2003 146, Royal Economic Society.
  8. H, Entorf & Michel Gollac & Francis Kramarz, 1997. "New Technologies, Wages and Worker Selection," Working Papers 97-25, Centre de Recherche en Economie et Statistique.
  9. Brynjolfsson, Erik. & Hitt, Lorin M., 1994. "Information technology as a factor of production : the role of differences among firms," Working papers 3715-94. CCSTR ; #173., Massachusetts Institute of Technology (MIT), Sloan School of Management.
  10. Ann P. Bartel & Nachum Sicherman, 1999. "Technological Change and Wages: An Interindustry Analysis," Journal of Political Economy, University of Chicago Press, vol. 107(2), pages 285-325, April.
  11. Robert J. Gordon, 2004. "Five Puzzles in the Behavior of Productivity, Investment, and Innovation," NBER Working Papers 10660, National Bureau of Economic Research, Inc.
  12. Entorf, Horst & Kramarz, Francis, 1997. "Does unmeasured ability explain the higher wages of new technology workers?," European Economic Review, Elsevier, vol. 41(8), pages 1489-1509, August.
  13. Erik Brynjolfsson & Lorin M. Hitt, 2003. "Computing Productivity: Firm-Level Evidence," The Review of Economics and Statistics, MIT Press, vol. 85(4), pages 793-808, November.
  14. repec:oup:qjecon:v:108:y:1993:i:1:p:33-60 is not listed on IDEAS
  15. Abowd, John M. & Kramarz, Francis, 1999. "The analysis of labor markets using matched employer-employee data," Handbook of Labor Economics, in: O. Ashenfelter & D. Card (ed.), Handbook of Labor Economics, edition 1, volume 3, chapter 40, pages 2629-2710 Elsevier.
  16. Irene Bertschek & Ulrich Kaiser, 2004. "Productivity Effects of Organizational Change: Microeconometric Evidence," Management Science, INFORMS, vol. 50(3), pages 394-404, March.
  17. repec:oup:qjecon:v:112:y:1997:i:1:p:253-90 is not listed on IDEAS
  18. repec:oup:qjecon:v:109:y:1994:i:2:p:367-97 is not listed on IDEAS
  19. David Card & John E. DiNardo, 2002. "Skill Biased Technological Change and Rising Wage Inequality: Some Problems and Puzzles," NBER Working Papers 8769, National Bureau of Economic Research, Inc.
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