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Title:Cyclical skill-biased technological change PDF Logo
Authors:Balleer, Almut
van Rens, Thijs
Issue Date:2009
Series/Report no.:IZA Discussion Papers 4258
Abstract:Over the past two decades, technological progress has been biased towards making skilled labor more productive. What does skill-biased technological change imply for business cycles? To answer this question, we construct a quarterly series for the skill premium from the CPS and use it to identify skill-biased technology shocks in a VAR with long run restrictions. We find that hours worked fall in response to skill-biased, but not in response to skill-neutral improvements in technology. Skill-biased technology shocks are associated with increases in the relative price of investment, indicating that capital and skill are substitutes in aggregate production.
Subjects:Skill-biased technology
skill premium
VAR
long-run restrictions
capital-skill complementarity
business cycle
JEL:E24
E32
J24
J31
Persistent Identifier of the first edition:urn:nbn:de:101:1-20090720265
Document Type:Working Paper
Appears in Collections:IZA Discussion Papers, Forschungsinstitut zur Zukunft der Arbeit (IZA)

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