Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/320305 
Year of Publication: 
2024
Citation: 
[Journal:] Quantitative Economics [ISSN:] 1759-7331 [Volume:] 15 [Issue:] 2 [Year:] 2024 [Pages:] 427-451
Publisher: 
The Econometric Society, New Haven, CT
Abstract: 
We study how technological change affects between- and within-education-group inequality in the United States. We develop a model with heterogeneous workers and firms in which the demand for skills is characterized by firms' recruiting behavior. We use the model to quantify the relative contribution of two types of technological change that affect the relative demand for skilled labor: technological change in firm-specific productivity and technological change in labor productivity. We find that technological change in labor productivity, in the form of higher returns to skill in production, is the main driver of the increase in between- and within-group inequality. Technological change in firm productivity, in the form of higher firm productivity dispersion, plays a less important role in explaining rising inequality, except for the increase in within-group inequality for workers without a college degree.
Subjects: 
Inequality
skill-biased technological change
firm productivity dispersion
skills
education
frictional labor markets
sorting
JEL: 
E24
I24
J23
J24
J31
Persistent Identifier of the first edition: 
Creative Commons License: 
cc-by-nc Logo
Document Type: 
Article

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