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Computers, skills and wages

Author

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  • Borghans, L.

    (Macro, International & Labour Economics)

  • ter Weel, B.J.

    (Macro, International & Labour Economics)

Abstract

Computer use is mainly associated with skilled, high-wage workers. Furthermore, the introduction of computers leads to upgrading of skill requirements. This suggests that the computer requires certain skills to take full advantage of its possibilities. Empirical findings, however, suggest that the effects of computers on the labor market are complicated and difficult to trace. This paper offers a simple model and new empirical evidence from Britain showing how computers change the labor market. The model shows that wages are an important determinant of computer use and that neither computer skills nor complementary skills seem to be needed to explain skill upgrading. The empirical results are consistent with the model because they indicate that computer use is explained by wages rather than by skills and that wages are not related to computer skills.
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Suggested Citation

  • Borghans, L. & ter Weel, B.J., 2001. "Computers, skills and wages," ROA Research Memorandum 5E, Maastricht University, Research Centre for Education and the Labour Market (ROA).
  • Handle: RePEc:unm:umaror:20015e
    DOI: 10.26481/umaror.200105E
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    Cited by:

    1. Borghans, Lex & ter Weel, Bas, 2007. "The diffusion of computers and the distribution of wages," European Economic Review, Elsevier, vol. 51(3), pages 715-748, April.
    2. Borghans, Lex & ter Weel, Bas, 2004. "Are computer skills the new basic skills? The returns to computer, writing and math skills in Britain," Labour Economics, Elsevier, vol. 11(1), pages 85-98, February.
    3. Shakina, Elena & Parshakov, Petr & Alsufiev, Artem, 2021. "Rethinking the corporate digital divide: The complementarity of technologies and the demand for digital skills," Technological Forecasting and Social Change, Elsevier, vol. 162(C).
    4. Casey Ichniowski & Kathryn Shaw, 2003. "Beyond Incentive Pay: Insiders' Estimates of the Value of Complementary Human Resource Management Practices," Journal of Economic Perspectives, American Economic Association, vol. 17(1), pages 155-180, Winter.
    5. Chris N. Sakellariou & Harry A. Patrinos, 2004. "Technology, computers and wages: evidence from a developing economy," Brussels Economic Review, ULB -- Universite Libre de Bruxelles, vol. 47(3-4), pages 543-543.
    6. Chris Sakellariou, 2009. "Endogeneity, computers, language skills and wages among university graduates in Vietnam," Applied Economics, Taylor & Francis Journals, vol. 41(5), pages 653-663.
    7. Hofer, Helmut & Riedel, Monika, 2003. "Computer Use and the Wage Structure in Austria," Economics Series 147, Institute for Advanced Studies.
    8. Thomas Heckel, 2006. "Les nouvelles technologies ont-elles modifié la trajectoire et la rémunération des jeunes et des qualifiés dans les années 1990 en France ?. Une étude à partir de données appariées entre individus et ," Revue économique, Presses de Sciences-Po, vol. 57(6), pages 1383-1400.

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    More about this item

    JEL classification:

    • J30 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - General
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials

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