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Are Computer Skills the New Basic Skills? The Returns to Computer, Writing and Math Skills in Britain

  • Borghans, Lex


    (Maastricht University)

  • ter Weel, Bas


    (CPB Netherlands Bureau for Economic Policy Analysis)

The large increase in computer use has raised the question whether people have to be taught computer skills before entering the labour market. Using data from the 1997 Skills Survey of the Employed British Workforce, we argue that neither the increase in computer use nor the fact that particularly higher skilled workers use a computer provides evidence that computer skills are valuable. We compare computer skills with writing and math skills and test whether wages vary with computer skills, given the specific use that is made of computers. The regression results show that while the ability to write documents and to carry out mathematical analyses yields significant labour-market returns, the ability to effectively use a computer has no substantial impact on wages. These estimates suggest that writing and math can be regarded as basic skills, but that the higher wages of computer users are unrelated to computer skills.

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Paper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 751.

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Length: 25 pages
Date of creation: Apr 2003
Date of revision:
Publication status: published in: Labour Economics, 2004, 11 (1), 85-98
Handle: RePEc:iza:izadps:dp751
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  1. Brian D. Bell, . "Skill-Biased Technical Change and Wages: Evidence from a Longitudinal Data Se," Economics Papers W25., Economics Group, Nuffield College, University of Oxford.
  2. Dinardo, J.E. & Pischke, J.S., 1996. "The Returns to Computer Use Revisited: Have Pencils Changed the Wage Structure Too?," Working papers 96-12, Massachusetts Institute of Technology (MIT), Department of Economics.
  3. Borghans,Lex & Weel,Bas,ter, 2001. "Computers, Skills and Wages," Research Memorandum 019, Maastricht University, Maastricht Economic Research Institute on Innovation and Technology (MERIT).
  4. Entorf, Horst & Gollac, Michel & Kramarz, Francis, 1999. "New Technologies, Wages, and Worker Selection," Journal of Labor Economics, University of Chicago Press, vol. 17(3), pages 464-91, July.
  5. Doms, Mark & Dunne, Timothy & Troske, Kenneth R, 1997. "Workers, Wages, and Technology," The Quarterly Journal of Economics, MIT Press, vol. 112(1), pages 253-90, February.
  6. Borghans,Lex & Weel,Bas,ter, 2002. "Do Older Workers Have More Trouble Using a Computer Than Younger Workers?," ROA Research Memorandum 003, Maastricht University, Research Centre for Education and the Labour Market (ROA).
  7. 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.
  8. Chennells, Lucy & Van Reenen, John, 1997. "Technical Change and Earnings in British Establishments," Economica, London School of Economics and Political Science, vol. 64(256), pages 587-604, November.
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