Working Paper: NBER ID: w10728
Authors: Aimee Chin; Chinhui Juhn; Peter Thompson
Abstract: Using a large, individual-level wage data set, we examine the impact of a major technological innovation the steam engine on skill demand and the wage structure in the merchant shipping industry. We find that the technical change created a new demand for skilled workers, the engineers, while destroying demand for workers with skills relevant only to sail. It had a deskilling effect on production work able-bodied seamen (essentially, artisans) were replaced by unskilled engine room operatives. On the other hand, mates and able-bodied seamen employed on steam earned a premium relative to their counterparts on sail. A wholesale switch from sail to steam would increase the 90/10 wage ratio by 40%, with most of the rise in inequality coming from the creation of the engineer occupation.
Keywords: wage structure; technical change; steam engine; merchant marine; skill demand
JEL Codes: J23; J31; N31; O30
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| steam engine (L94) | demand for skilled workers (J24) |
| steam engine (L94) | demand for traditional skilled workers (J24) |
| steam engine (L94) | wage inequality (J31) |
| demand for skilled workers (J24) | wage premium for able-bodied seamen on steam vessels (J33) |
| steam engine (L94) | deskilling effect for some occupations (F66) |
| steam engine (L94) | creation of new skilled positions (J24) |