Technical Change, Inequality, and the Labor Market
Journal of Economic Literature, 2002, vol. 40, issue 1, 7-72
This essay discusses the effect of technical change on wage inequality. I argue that the behavior of wages and returns to schooling indicates that technical change has been skill-biased during the past sixty years. Furthermore, the recent increase in inequality is most likely due to an acceleration in skill bias. In contrast to twentieth-century developments, much of the technical change during the early nineteenth century appears to be skill-replacing. I suggest that this is because the increased supply of unskilled workers in the English cities made the introduction of these technologies profitable. On the other hand, the twentieth century has been characterized by skill-biased technical change because the rapid increase in the supply of skilled workers has induced the development of skill-complementary technologies. The recent acceleration in skill bias is in turn likely to have been a response to the acceleration in the supply of skills during the past several decades.
Note: DOI: 10.1257/0022051026976
References: View references in EconPapers View complete reference list from CitEc
Citations View citations in EconPapers (631) Track citations by RSS feed
Downloads: (external link)
Access to full text is restricted to AEA members and institutional subscribers.
Working Paper: Technical Change, Inequality, and the Labor Market (2000)
This item may be available elsewhere in EconPapers: Search for items with the same title.
Export reference: BibTeX
RIS (EndNote, ProCite, RefMan)
Persistent link: http://EconPapers.repec.org/RePEc:aea:jeclit:v:40:y:2002:i:1:p:7-72
Ordering information: This journal article can be ordered from
Access Statistics for this article
Journal of Economic Literature is currently edited by Janet Currie
More articles in Journal of Economic Literature from American Economic Association Contact information at EDIRC.
Series data maintained by Jane Voros ().