• Table of Contents
    • Abstract
    • Keywords
    • Article
      • From factor-neutral to factor-biased technical change
      • The skill bias of information technologies
      • Technology-skill complementarity
      • Endogenous direction of technical change
    • See Also
    • Bibliography
    • How to cite this article

skill-biased technical change

Giovanni L. Violante
From The New Palgrave Dictionary of Economics, Second Edition, 2008
Edited by Steven N. Durlauf and Lawrence E. Blume
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Abstract

Skill-biased technical change is a shift in the production technology that favours skilled over unskilled labour by increasing its relative productivity and, therefore, its relative demand. Traditionally, technical change is viewed as factor-neutral. However, recent technological change has been skill-biased. Theories and data suggest that new information technologies are complementary with skilled labour, at least in their adoption phase. Whether new capital complements skilled or unskilled labour may be determined endogenously by innovators’ economic incentives shaped by relative prices, the size of the market, and institutions. The ‘factor bias’ attribute puts technological change at the center of the income-distribution debate.
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Keywords

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Article

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How to cite this article

Violante, Giovanni L. "skill-biased technical change." The New Palgrave Dictionary of Economics. Second Edition. Eds. Steven N. Durlauf and Lawrence E. Blume. Palgrave Macmillan, 2008. The New Palgrave Dictionary of Economics Online. Palgrave Macmillan. 31 October 2014 <http://www.dictionaryofeconomics.com/article?id=pde2008_S000493> doi:10.1057/9780230226203.1538

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