Technological Change and Skill-based Employment Disparities: Evidence from Turkey

Ilina Srour, Marco Vivarelli () and Erol Taymaz

No dises1393, DISCE - Quaderni del Dipartimento di Scienze Economiche e Sociali from Università Cattolica del Sacro Cuore, Dipartimenti e Istituti di Scienze Economiche (DISCE)

Abstract: This paper explores the causes of skill-based employment differentials within the Turkish manufacturing sector over the period 1980-2001. Turkey is taken as an example of a developing economy that, in that period, had been technologically advancing and becoming increasingly integrated with the world market. The empirical analysis is performed at firm level within a dynamic framework using a two-equation model that depicts the employment trends for skilled and unskilled workers separately. In particular, the System Generalized Method of Moments (GMM-SYS) procedure is applied to a panel dataset comprised of 17,462 firms. Our results confirm the theoretical expectation that developing countries face the phenomena of skill-biased technological change and skill-enhancing technology import, both leading to increasing the employment gap between skilled and unskilled workers. In particular, strong evidence of a relative skill bias emerges: both domestic and imported technologies increase the demand for skilled labor 5 to 6 times more than the corresponding demand for the unskilled labor. Finally, “learning by export” also appears to have a skill biased impact, but to a lesser extent.

Keywords: Skill-biased technological change; technology transfer; panel data; GMM-SYS (search for similar items in EconPapers)
JEL-codes: F16 O33 (search for similar items in EconPapers)
Pages: 23 pages
Date: 2013-05
New Economics Papers: this item is included in nep-ara
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Citations: View citations in EconPapers (1)

Published in Review of Economics

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