Working Paper: NBER ID: w2732
Authors: Ann P. Bartel; Frank R. Lichtenberg
Abstract: This paper examines the relationship between technological change and wages using pooled cross-sectional industry-level data and several alternative indicators of the rate of introduction of new technology. Our main finding is that industries with a high rate of technical change pay higher wages to workers of given age and education, compared to less technologically advanced industries. This is Consistent with the notion that the introduction of new technology creates a demand for learning, that learning is a function of employee ability and effort, and that increases in wages are required to elicit increases in ability and effort. A related finding is that the wages of highly educated workers (especially recent graduates) relative to those of less educated workers are highest in technologically advanced industries; this is consistent with the notion that educated workers are better learners.
Keywords: Technological Change; Wages; Learning; Labor Economics
JEL Codes: J31; O33
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| technological change (O33) | wage levels (J31) |
| high rate of technical change (O33) | higher wages (J39) |
| new technology (O33) | increased learning (I25) |
| increased learning (I25) | higher wages (J39) |
| employee ability (M51) | increased learning (I25) |
| employee effort (M52) | increased learning (I25) |
| technological change (O33) | wage increases for highly educated workers (J39) |
| employment share of high-wage workers (J39) | average wage rate (J31) |
| technological change (O33) | higher wages within education groups (I24) |