Skill-Biased Technical Change Theoretical Concepts, Empirical Problems and a Survey of the Evidence

Mark Sanders and Bas ter Weel

No 00-8, DRUID Working Papers from DRUID, Copenhagen Business School, Department of Industrial Economics and Strategy/Aalborg University, Department of Business Studies

Abstract: The structure of wages and employment has shifted against the low-skilled in many OECD countries over the last decade. Many authors have attributed this shift to the impact of new technologies, and or technical change in general. This paper investigates and structures the growing body of literature on skill-biased technical change (SBTC) by first presenting a model in which SBTC is formalised and decomposed into factor and sector biases of technical change. We show that as we go down to the job level the scope for pure within unit-skill bias decreases and between-unit effects explain the within-unit effects detected at higher aggregation levels. Second, we address some potential sources of skill bias, which are learning, R&D, human capital formation, organisational change and the introduction of new general purpose technologies. Finally we present some conceptual and practical problems we encounter when studying SBTC empirically. We conclude with a survey of selected empirical literature on the subject and discuss the results in light of the empirical and theoretical problems pointed out above.

Keywords: Technical change; skill; learning (search for similar items in EconPapers)
JEL-codes: D24 O32 O33 (search for similar items in EconPapers)
Date: 2000
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Citations: View citations in EconPapers (37)

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Working Paper: Skill-Biased Technical Change: Theoretical Concepts, Empirical Problems and a Survey of the Evidence (2000)
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