Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/245502 
Year of Publication: 
2021
Series/Report no.: 
CESifo Working Paper No. 9321
Publisher: 
Center for Economic Studies and ifo Institute (CESifo), Munich
Abstract: 
We use census data to show that structural transformation reflects a fundamental reallocation of labor from goods to services, instead of a relabelling that occurs when goods-producing firms outsource their in-house service production. The novelty of our approach is that it categorizes labor by occupations, which are invariant to outsourcing. We find that the reallocation of labor from goods-producing to service-producing occupations is a robust feature in censuses from around the world and different time periods. To understand the underlying forces, we propose a tractable model in which uneven occupation-specific technological change generates structural transformation of occupation employment.
Subjects: 
biased technological change
occupations
outsourcing
structural transformation
JEL: 
O11
O14
Document Type: 
Working Paper
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