Skill Polarization in Local Labour Markets under Share-Altering Technical Change

Antonio Accetturo, Alberto Dalmazzo () and Guido de Blasio

Department of Economics University of Siena from Department of Economics, University of Siena

Abstract: This paper considers the “share-altering” technical change hypothesis in a spatial general equilibrium model where individuals have different levels of skills. Building on a simple Cobb-Douglas production function, our model shows that the implementation of skill-biased technologies requires a sufficient proportion of highly educated individuals. Moreover, areas that experiment this kind of technical change will initially exhibit a rise in local skill premia, but such a trend tends to be reverted over time due to labour mobility. Also, when technical progress is such to disproportionately replace middle-skill jobs, the local distribution of skill will exhibit “fat-tails”, where the proportion of both highly skilled and low-skilled workers increases. These predictions are consistent with recent existing evidence.

Keywords: share-altering technologies; local skill distribution; local wage premium. (search for similar items in EconPapers)
JEL-codes: J31 O33 R12 R23 (search for similar items in EconPapers)
Date: 2011-11
New Economics Papers: this item is included in nep-ure
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http://repec.deps.unisi.it/quaderni/625.pdf (application/pdf)

Related works:
Journal Article: SKILL POLARIZATION IN LOCAL LABOR MARKETS UNDER SHARE-ALTERING TECHNICAL CHANGE (2014)
Working Paper: Skill Polarization in Local Labour Markets under Share-Altering Technical Change (2012)
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Persistent link: https://EconPapers.repec.org/RePEc:usi:wpaper:625

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