ICT capital–skill complementarity and wage inequality: Evidence from OECD countries

Hiroya Taniguchi and Ken Yamada

Labour Economics, 2022, vol. 76, issue C

Abstract: Although wage inequality has evolved in advanced countries over recent decades, it remains unknown the extent to which changes in wage inequality and their differences across countries are attributable to specific capital and labor quantities. We examine this issue by estimating a sector-level production function extended to allow for capital–skill complementarity and factor-biased technological change using cross-country and cross-industry panel data. Our results indicate that most of the changes in the skill premium are attributable to the relative quantities of ICT equipment, skilled labor, and unskilled labor in the goods and service sectors of the majority of advanced countries.

Keywords: Skill premium; Capital-skill complementarity; Technological change; Information and communication technology (ICT); Production function (search for similar items in EconPapers)
JEL-codes: C33 E24 J24 J31 O50 (search for similar items in EconPapers)
Date: 2022
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (5)

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Working Paper: ICT Capital-Skill Complementarity and Wage Inequality: Evidence from OECD Countries (2022)
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Persistent link: https://EconPapers.repec.org/RePEc:eee:labeco:v:76:y:2022:i:c:s0927537122000446

DOI: 10.1016/j.labeco.2022.102151

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