Working Paper: CEPR ID: DP5086
Authors: Helena Svaleryd; Jonas Vlachos
Abstract: In this paper, we empirically address the hypothesis that there is a relationship between the supply of human capital and the rate and direction of skill-biased technical change (SBTC). Using country- and industry-level data on OECD countries, we find R&D to be positively related to the supply of human capital. There is, however, no indication that this translates into higher rates of SBTC, when SBTC is measured as changes in the wage bill share of skilled labour. Interestingly, both R&D and the rate of SBTC seem to be relatively high in low-skill industries in countries where the supply of human capital is relatively high.
Keywords: skill-biased technical change; supply of human capital
JEL Codes: J31; O31
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| Human Capital Supply (J24) | SBTC (Y20) |
| Human Capital Supply (J24) | R&D Spending (O32) |
| R&D Spending (O32) | SBTC (Y20) |
| Human Capital Supply + Skill Intensity (J24) | SBTC (Y20) |
| High Human Capital Supply + High-Skill Industries (J24) | Low SBTC (E42) |
| Low-Skill Industries + High Human Capital Countries (J24) | High SBTC (E42) |