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The Supply of Skilled Labor and Skill-Biased Technological Progress (1997)
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@MISC{Kiley97thesupply,
author = {Michael T. Kiley},
title = {The Supply of Skilled Labor and Skill-Biased Technological Progress},
year = {1997}
}
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Abstract
Rising inequality in the relative wages of skilled and unskilled labor in the 1980's is often attributed to skill-biased technological progress. This paper presents a model in which the adoption of skill-biased or "unskilled-biased" technologies is endogenous. Conventional wisdom states that an increase in the supply of skilled labor lowers the relative wage of skilled to unskilled labor. In this paper's endogenous growth model, an increase in the supply of skilled labor leads to temporary stagnation in the wages of unskilled workers and an expanding gap between the wages of skilled and unskilled workers. An increase in the supply of skilled labor accelerates skill-biased technological change, and, under plausible conditions, lowers output growth at least temporarily.
Keyphrases
skill-biased technological progress skilled labor relative wage unskilled worker unskilled labor skilled labor lead endogenous growth model conventional wisdom state lower output growth skill-biased technological change plausible condition temporary stagnation unskilled-biased technology skilled labor lower
