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Power-Biased Technological Change and the Rise in Earnings Inequality

Frederick Guy () and Peter Skottz ()
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Peter Skottz: Department of Economics, University of Massachusetts

Authors registered in the RePEc Author Service: Peter Skott ()

No 6, Working Papers from ECINEQ, Society for the Study of Economic Inequality

Abstract: New information and communication technologies, we argue, have been ‘power- biased’: they have allowed firms to monitor low-skill workers more closely, thus reducing the power of these workers. An efficiency wage model shows that ‘power-biased technical change’ in this sense may generate rising wage inequality accompanied by an increase in both the effort and unemployment of low-skill workers. The skill-biased technological change hypothesis, on the other hand, others no explanation for the ob- served increase in effort.

Keywords: power-biased technical change; skill bias; efficiency wages; wage inequality; work intensity. (search for similar items in EconPapers)
JEL-codes: J31 O33 (search for similar items in EconPapers)
Pages: 24 pages
Date: 2005-11
New Economics Papers: this item is included in nep-hrm, nep-ino and nep-lab
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http://www.ecineq.org/milano/WP/ECINEQ2005-06.pdf First version, 2005 (application/pdf)

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