Optimal Technology and Development
Skill intensive technologies seem to be adopted by rich countries rather than poor ones. Related to that observation, the ratio of wages of skilled to unskilled workers - the skill premium - shows two important features over time and across countries. In the US the skill premium decreased during the first half of the 20th century and it increased after 1950, evolving according to a U shaped pattern. On the other hand, the same measure across countries around 1990 is hump shaped when countries are ordered by GDP per worker. By modeling the decisions for factor accumulation and technology adoption, this paper gives a systematic explanation as to why we see ever more skill intensive technologies being adopted both over time in the US and across countries. The model developed here endogenously generates predictions for the skill premium that are consistent with both the US and international observations under the same set of parameter values.
|Date of creation:||Sep 2006|
|Date of revision:|
|Contact details of provider:|| Postal: Ludwigstraße 33, D-80539 Munich, Germany|
Web page: https://mpra.ub.uni-muenchen.de
More information through EDIRC
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Daron Acemoglu, 1998.
"Why Do New Technologies Complement Skills? Directed Technical Change and Wage Inequality,"
The Quarterly Journal of Economics,
Oxford University Press, vol. 113(4), pages 1055-1089.
- Acemoglu, Daron, 1997. "Why Do New Technologies Complement Skills? Directed Technical Change and Wage Inequality," CEPR Discussion Papers 1707, C.E.P.R. Discussion Papers.
- Acemoglu, D., 1997. "Why Do New Technologies Complement Skills? Directed Technical Change and Wage Inequality," Working papers 97-14, Massachusetts Institute of Technology (MIT), Department of Economics.
- Chris Papageorgiou & Fidel Pérez Sebastián & John Duffy, 2002.
"Capital-Skill Complementarity? Evidence From A Panel Of Countries,"
Working Papers. Serie AD
2002-09, Instituto Valenciano de Investigaciones Económicas, S.A. (Ivie).
- John Duffy & Chris Papageorgiou & Fidel Perez-Sebastian, 2004. "Capital-Skill Complementarity? Evidence from a Panel of Countries," The Review of Economics and Statistics, MIT Press, vol. 86(1), pages 327-344, February.
- Chris Papageorgiou & John Duffy & Fidel Perez-Sebastian, . "Capital-Skill complementarity? Evidence from a Panel of Countries," Departmental Working Papers 2003-012, Department of Economics, Louisiana State University.
- Peter J. Klenow & Mark Bils, 2000. "Does Schooling Cause Growth?," American Economic Review, American Economic Association, vol. 90(5), pages 1160-1183, December.
- Michael T. Kiley, 1997.
"The supply of skilled labor and skill-based technological progress,"
Finance and Economics Discussion Series
1997-45, Board of Governors of the Federal Reserve System (U.S.).
- Kiley, Michael T, 1999. "The Supply of Skilled Labour and Skill-Biased Technological Progress," Economic Journal, Royal Economic Society, vol. 109(458), pages 708-24, October.
- Stephen L. Parente & Edward C. Prescott, 2002. "Barriers to Riches," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262661306, March.
- Per Krusell & Lee E. Ohanian & JosÈ-Victor RÌos-Rull & Giovanni L. Violante, 2000.
"Capital-Skill Complementarity and Inequality: A Macroeconomic Analysis,"
Econometric Society, vol. 68(5), pages 1029-1054, September.
- Per Krusell & Lee E. Ohanian & Jose-Victor Rios-Rull & Giovanni L. Violante, 1997. "Capital-skill complementarity and inequality: a macroeconomic analysis," Staff Report 239, Federal Reserve Bank of Minneapolis.
- Kevin M. Murphy & W. Craig Riddell & Paul M. Romer, 1998. "Wages, Skills, and Technology in the United States and Canada," NBER Working Papers 6638, National Bureau of Economic Research, Inc.
- Daron Acemoglu, 2001.
"Directed Technical Change,"
NBER Working Papers
8287, National Bureau of Economic Research, Inc.
- Boyan Jovanovic, 1998.
"Vintage Capital and Inequality,"
NBER Working Papers
6416, National Bureau of Economic Research, Inc.
- Daniel S. Hamermesh, 1993. "Labor Demand and the Source of Adjustment Costs," NBER Working Papers 4394, National Bureau of Economic Research, Inc.
- repec:fth:starer:98-16 is not listed on IDEAS
- James J. Heckman & Lance Lochner & Christopher Taber, 1998.
"Explaining Rising Wage Inequality: Explorations with a Dynamic General Equilibrium Model of Labor Earnings with Heterogeneous Agents,"
NBER Working Papers
6384, National Bureau of Economic Research, Inc.
- James Heckman & Lance Lochner & Christopher Taber, 1998. "Explaining Rising Wage Inequality: Explanations With A Dynamic General Equilibrium Model of Labor Earnings With Heterogeneous Agents," Review of Economic Dynamics, Elsevier for the Society for Economic Dynamics, vol. 1(1), pages 1-58, January.
- Jovanovic, Boyan & Nyarko, Yaw, 1996.
"Learning by Doing and the Choice of Technology,"
Econometric Society, vol. 64(6), pages 1299-1310, November.
- Boyan Jovanovic & Yaw Nyarko, 1994. "Learning By Doing and the Choice of Technology," NBER Working Papers 4739, National Bureau of Economic Research, Inc.
- Jovanovic, B. & Nyarko, Y., 1996. "Learning by Doing and the Choice of Technology," Working Papers 96-25, C.V. Starr Center for Applied Economics, New York University.
- Funk, Peter & Vogel, Thorsten, 2004. "Endogenous skill bias," Journal of Economic Dynamics and Control, Elsevier, vol. 28(11), pages 2155-2193, October.
- R. Glenn Hubbard & Jonathan Skinner & Stephen P. Zeldes, 1993.
"The Importance of Precautionary Motives in Explaining Individual and Aggregate Saving,"
NBER Working Papers
4516, National Bureau of Economic Research, Inc.
- Hubbard, R. Glenn & Skinner, Jonathan & Zeldes, Stephen P., 1994. "The importance of precautionary motives in explaining individual and aggregate saving," Carnegie-Rochester Conference Series on Public Policy, Elsevier, vol. 40(1), pages 59-125, June.
- Ananth Seshadri & Rodolfo Manuelli, 2005. "Human Capital and the Wealth of Nations," 2005 Meeting Papers 56, Society for Economic Dynamics.
- Caselli, Francesco & Coleman II, Wilbur John, 2000.
"The World Technology Frontier,"
CEPR Discussion Papers
2584, C.E.P.R. Discussion Papers.
- Robert J. Barro & Jong-Wha Lee, 1993.
"International Comparisons of Educational Attainment,"
NBER Working Papers
4349, National Bureau of Economic Research, Inc.
- Barro, Robert J. & Lee, Jong-Wha, 1993. "International comparisons of educational attainment," Journal of Monetary Economics, Elsevier, vol. 32(3), pages 363-394, December.
- Psacharopoulos, George & Patrinos, Harry Anthony, 2002.
"Returns to investment in education : a further update,"
Policy Research Working Paper Series
2881, The World Bank.
- George Psacharopoulos & Harry Anthony Patrinos, 2004. "Returns to investment in education: a further update," Education Economics, Taylor & Francis Journals, vol. 12(2), pages 111-134.
- Hirofumi Uzawa, 1962. "Production Functions with Constant Elasticities of Substitution," Review of Economic Studies, Oxford University Press, vol. 29(4), pages 291-299.
- Chari, V V & Hopenhayn, Hugo, 1991. "Vintage Human Capital, Growth, and the Diffusion of New Technology," Journal of Political Economy, University of Chicago Press, vol. 99(6), pages 1142-65, December.
- Papageorgiou, Chris & Perez-Sebastian, Fidel, 2006. "Dynamics in a non-scale R&D growth model with human capital: Explaining the Japanese and South Korean development experiences," Journal of Economic Dynamics and Control, Elsevier, vol. 30(6), pages 901-930, June.
- repec:fth:starer:9816 is not listed on IDEAS
When requesting a correction, please mention this item's handle: RePEc:pra:mprapa:1644. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Joachim Winter)
If references are entirely missing, you can add them using this form.