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Disentangling Occupation- and Sector-specific Technological Change

Zsofia Barany () and Christian Siegel

No 12663, CEPR Discussion Papers from C.E.P.R. Discussion Papers

Abstract: To study the drivers of the employment reallocation across sectors and occupations between 1960 and 2010 in the US we propose a model where technology evolves at the sector-occupation cell level. Since the framework does not a priori impose a specific form of technological change, it allows us to quantify the respective role of sector-specific and of occupation-specific technological change. We implement a novel method to extract changes in sector-occupation cell productivities from the data. Using a factor model we find that occupation and sector factors jointly explain 74-87 percent of cell productivity changes, with the occupation component being by far the most important. While in our general equilibrium model both factors imply similar reallocations of labor across sectors and occupations, quantitatively the bias in technological change across occupations is much more important than the bias across sectors.

Keywords: biased technological change; employment polarization; structural change (search for similar items in EconPapers)
JEL-codes: J24 O33 O41 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-eff, nep-ino, nep-lma and nep-tid
Date: 2018-01
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Working Paper: Disentangling Occupation- and Sector-specific Technological Change (2017) Downloads
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