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Computers, Work Organization, and Wage Outcomes

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  • Peter Cappelli
  • William H. Carter

Abstract

We examine two factors frequently thought to be changing the U.S. workplace, high performance work practices and computer use, and their relationships with pay using a national probability sample of U.S. establishments. The analysis controls for both organizational and individual characteristics and finds that higher wages are associated with several practices, particularly computer use and teamwork, for front-line workers who are the targets of most high performance work practices. Not surprisingly, relationships are not as strong for other occupations and are very weak in the non-manufacturing sector. Computer use is a particularly important influence on the wages of managers and supervisors, although it is computer use by their subordinates that is the important factor. The most unusual result may be the consistently negative and significant relationship between wages and job rotation where additional analyses suggest that job rotation in isolation from other high performance practices may proxy lower skill jobs. Some of the positive relationships vanish when various controls for human capital are added, suggesting that those wage premiums are a return to human capital and may be driven by greater skill requirements.

Suggested Citation

  • Peter Cappelli & William H. Carter, 2000. "Computers, Work Organization, and Wage Outcomes," NBER Working Papers 7987, National Bureau of Economic Research, Inc.
  • Handle: RePEc:nbr:nberwo:7987
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    References listed on IDEAS

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    Citations

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    Cited by:

    1. Sandra E. Black & Lisa M. Lynch, 2005. "Measuring Organizational Capital in the New Economy," NBER Chapters,in: Measuring Capital in the New Economy, pages 205-236 National Bureau of Economic Research, Inc.
    2. Ganna Vakhitova & Christopher R. Bollinger, 2011. "Labor Market Return to Computer Skills: Using Microsoft Certification to Measure Computer Skills," Discussion Papers 46, Kyiv School of Economics.
    3. Felipe Balmaceda, 2006. "Task-Specific Training and Job Design," Documentos de Trabajo 223, Centro de Economía Aplicada, Universidad de Chile.
    4. Boucekkine, Raouf & Crifo, Patricia, 2008. "Human Capital Accumulation And The Transition From Specialization To Multitasking," Macroeconomic Dynamics, Cambridge University Press, vol. 12(03), pages 320-344, June.
    5. Paola Gritti & Riccardo Leoni, 2013. "The impact on wages of generic competencies, psychological capital, new work practices and digital technologies," Working Papers (2013-) 1301, University of Bergamo, Department of Management, Economics and Quantitative Methods.
    6. Borghans, Lex & Weel, Bas ter, 2001. "What happens when agent T gets a computer?," Research Memorandum 017, Maastricht University, Maastricht Economic Research Institute on Innovation and Technology (MERIT).
    7. Richard B. Freeman, 2002. "The Labour Market in the New Information Economy," Oxford Review of Economic Policy, Oxford University Press, vol. 18(3), pages 288-305.
    8. repec:spr:italej:v:3:y:2017:i:1:d:10.1007_s40797-016-0046-7 is not listed on IDEAS
    9. Sandra E. Black & Lisa Lynch & Anya Krivelyova, 2003. "How Workers Fare When Employers Innovate," NBER Working Papers 9569, National Bureau of Economic Research, Inc.
    10. Fali Huang & Peter Cappelli, 2006. "Employee Screening: Theory and Evidence," NBER Working Papers 12071, National Bureau of Economic Research, Inc.
    11. Spyros Arvanitis & Euripidis N. Loukis, 2009. "Employee education, information and communication technology, workplace organization and trade," KOF Working papers 09-234, KOF Swiss Economic Institute, ETH Zurich.
    12. Uwe Jirjahn & Kornelius Kraft, 2010. "Teamwork And Intra-Firm Wage Dispersion Among Blue-Collar Workers," Scottish Journal of Political Economy, Scottish Economic Society, vol. 57(4), pages 404-429, September.
    13. Tushar Kanti Nandi, 2006. "Employee Participation and Wages: An Empirical Investigation with Selectivity Correction," Department of Economics University of Siena 483, Department of Economics, University of Siena.
    14. Marianne Bitler, 2001. "Small business and computers: adoption and performance," Working Paper Series 2001-15, Federal Reserve Bank of San Francisco.
    15. Wolf, Elke & Heinze, Anja, 2007. "How to Limit Discrimination? Analyzing the Effects of Innovative Workplace Practices on Intra-Firm Gender Wage Gaps Using Linked Employer-Employee Data," ZEW Discussion Papers 07-077, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research.
    16. Stephanie Lluis, "undated". "Human Resource Management Practices and Wage Dispersion in U.S. Establishments," Working Papers 0603, Human Resources and Labor Studies, University of Minnesota (Twin Cities Campus).

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    JEL classification:

    • J3 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs

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