Effects of Technological Shock on Employment: Application of Structural Approach VECM

Sirine Mnif (), Chiraz Feki () and Ines Abdelkafi ()
Additional contact information
Sirine Mnif: Faculty of Economics and Management of Sfax
Chiraz Feki: Faculty of Economics and Management of Sfax
Ines Abdelkafi: Faculty of Economics and Management of Sfax

Journal of the Knowledge Economy, 2018, vol. 9, issue 4, No 4, 1138-1153

Abstract: Abstract This article examines the link between technological changes and employment. The objective of this work is to determine the impact of technological innovations in the short and long term. In all the developed countries, the unemployed are rather low-skilled whereas highly skilled employees face less unemployment problems. Several studies have shown that technical progress leads to the casualization of non-skilled labor and to unemployment. This idea is based on the substitution of capital at work. Moreover, technical progress requires a skilled workforce capable of creating, innovating, and controlling further progress. Thus, technological innovations are not neutral; there are skill-biased technological changes. However, according to the theory of compensation, technological innovations reduce short-term employment (replacement effect) but create it in the medium and long term (compensation effect). The empirical validation of this work is based on the technique of structural VECM for the case of Tunisia. Unlike the theory of compensation, our results support the fact that the short-term effect of technological innovations on employment is positive; however, in the medium and long term, it is negative.

Keywords: Technological innovations; Employment; Structural VECM (search for similar items in EconPapers)
JEL-codes: E24 O3 (search for similar items in EconPapers)
Date: 2018
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (3)

Downloads: (external link)
http://link.springer.com/10.1007/s13132-016-0405-5 Abstract (text/html)
Access to the full text of the articles in this series is restricted.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:spr:jknowl:v:9:y:2018:i:4:d:10.1007_s13132-016-0405-5

Ordering information: This journal article can be ordered from
http://www.springer.com/economics/journal/13132

DOI: 10.1007/s13132-016-0405-5

Access Statistics for this article

Journal of the Knowledge Economy is currently edited by Elias G. Carayannis

More articles in Journal of the Knowledge Economy from Springer, Portland International Center for Management of Engineering and Technology (PICMET)
Bibliographic data for series maintained by Sonal Shukla () and Springer Nature Abstracting and Indexing ().