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Technological Transitions and Educational Policies

Mario Amendola and Francesco Vona ()

No 9, Working Papers - Dipartimento di Economia from Dipartimento di Economia, Sapienza University of Rome

Abstract: This paper presents an out-of-equilibrium model to explain cross-country di erences in the capacity to absorb new skill-biased technologies. The usual mainstream viewpoint stressing the role of labour markets will be re-examined in a context characterized by a sequential structure of both the process of production and the skill formation, whose interaction brings about coordination failures harming the viabiity of the innovation process. In this light, educational policies play a crucial role in restoring the required coordination. The robust results of the simulations show that educational policies appear to be important both in rigid and in exible systems. In the former case, educational policies nanced by taxation allow the system to escape a low productivity nal equilibrium. In the latter, they contrast the nancial constraint associated to a large decrease in the unskilled wage. Altogether, a moderate degree of rigidity seems the most appropriate institutional environment to reach the targets of viability and of a full exploitation of the technological potential.

Keywords: Skill-Biased Technical Change; Labour Markets; Educational Policies; Out-of-Equilibrium Models (search for similar items in EconPapers)
JEL-codes: E22 E24 O3 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-edu, nep-lab and nep-mac
Date: 2010, Revised 2010
References: View complete reference list from CitEc
Citations: View citations in EconPapers (1) Track citations by RSS feed

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Journal Article: Coordinating the accumulation of physical and human capital in different institutional settings (2012) Downloads
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