A vast literature aimed at understanding the nature and causes of wage inequality focuses on skill premium as a key object interest. In an environment where both share skilled workers are changing, however, between-skill-group component may fall even rises – pattern that is indeed observed in U.S. many local labor markets during 2010s. Understanding evolution therefore not always useful terms w...

In this Addendum we set up a perfectly competitive version of the model and conduct a range of comparative static exercises under simplifying assumptions. Compared to the model described in Section 2 of our main paper, we assume that there is a large number of …rms in each variety (!; j) in each country and that within a country all …rms have access to the same productivity z. This implies that...

Abstract This paper studies the impact of automation shocks on technological-knowledge level, skill premium (or wage inequality), real prices, output, and economic growth. To highlight mechanisms, we devise a task-based direct technical change model that allows us to analyze determinants threshold task, relative output prices between sectors, intra- inter-sectoral differences, polarization grow...

The factors behind the increase in the relative wages of skilled workers in developing countries are still not well understood. The authors use data from Peru to analyze the determinants of withinindustry share of skilled workers. They use a translog cost function for gross output and are therefore able to incorporate the effects of materials, both domestic and imported, in addition to capital....

This paper analyzes the earnings effect of skill-biased technological change (SBTC), focusing on the comparison of science and engineering (S&E) and non-S&E occupations. In the analysis, we assert that S&E occupations and non-S&E occupations differ in the nature of skill requirements and their susceptibility to technological change; and consequently the earnings effects of SBTC also demonstrate...