Occupational Exposure to Capital-Embodied Technical Change

Julieta Caunedo, David Jaume and Elisa Keller

American Economic Review, 2023, vol. 113, issue 6, 1642-85

Abstract: We study differences in exposure to factor-biased technical change among occupations by providing the first measures of capital-embodied technical change (CETC) and of the elasticity of substitution between capital and labor at the occupational level. We document sizable occupational heterogeneity in both measures, but quantitatively, it is the heterogeneity in factor substitutability that fuels workers' exposure to CETC. In a general equilibrium model of worker sorting across occupations, CETC accounts for almost all of the observed labor reallocation in the US between 1984 and 2015. Absent occupational heterogeneity in factor substitutability, CETC accounts for only 17 percent of it.

JEL-codes: I26 J16 J24 J31 O33 (search for similar items in EconPapers)
Date: 2023
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Citations: View citations in EconPapers (7)

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Working Paper: Occupational Exposure to Capital-Embodied Technical Change (2021)
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DOI: 10.1257/aer.20211478

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