Technological change and wage premiums: Historical evidence from linked employer–employee data

Sanna-Mari Hynninen, Jari Ojala and Jaakko Pehkonen

Labour Economics, 2013, vol. 24, issue C, 1-11

Abstract: This study analyses the impacts of a technological change (the steam engine) on wage premiums. Using historical employer–employee panel data, we found that steam technology had both new skill-demanding and skill-replacing aspects. The former manifested itself as an increase in the demand for high-skilled engineers, the latter in a decline in the demand for intermediate-skilled, able-bodied seamen and an increase in the demand for unskilled engine room operators. Our panel data analysis, which controls for unobserved heterogeneity, implies that high-skilled labourers in abstract tasks and unskilled labourers in manual tasks improved their wage positions relative to intermediate-skilled labourers in routine tasks. These findings are compatible with the hypothesis of technology-based polarisation.

Keywords: Wage; Premium; Skill; Task; Technological change; Polarisation (search for similar items in EconPapers)
JEL-codes: J31 (search for similar items in EconPapers)
Date: 2013
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (8)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:labeco:v:24:y:2013:i:c:p:1-11

DOI: 10.1016/j.labeco.2013.05.006

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