Skill Biased Technological and Organizational Change: Estimating a Mixed Simultaneous Equation Model Using the IAB Establishment Panel

Reinhard Hujer (), Marco Caliendo and Dubravko Radic ()
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Reinhard Hujer: Goethe University Frankfurt
Dubravko Radic: University of Wuppertal

No 566, IZA Discussion Papers from Institute of Labor Economics (IZA)

Abstract: Recent years have brought growing evidence for an increasing labour demand for high skilled and a deterioration of the labour position of less skilled employees. The two most common explanations for this finding are an increasing international trade and a skill biased technological change. Another possible source for this phenomenon, that has received less attention in the recent discussion, are organizational changes that might affect labour demand in an asymmetric way, too. This paper analyses the interdependencies between labour demand for high and low skilled employees, innovation activities and organizational changes. To this aim mixed simultaneous equation models are estimated using the IAB establishment dataset collected by the German Federal Employment Office. Our empirical results indicate that technological change in the form of product innovations increases the demand for high and reduces the demand for low skilled employees. Organizational changes on the other hand do not have any significant effect on the labour demand, but are closely related to innovations.

Keywords: mixed simultaneous equation models; labour demand; skilled biased (search for similar items in EconPapers)
JEL-codes: C35 D24 L23 O33 (search for similar items in EconPapers)
Pages: 52 pages
Date: 2002-09
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Citations: View citations in EconPapers (13)

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