This paper develops a growth model characterized by ability-biased technological transition in which the evolution of technology, education attainment, and wage inequality is consistent with the observed pattern in the United States and other advanced countries over the past several decades. It argues that an increase in the rate of technological progress raises the return to ability and simultaneously generates an increase in wage inequality between and within groups of skilled and unskilled workers, an increase in average wages of skilled workers, a temporary decline in average wages of unskilled workers, an increase in education, and a productivity transitory slowdown.
Galor, Oded, and Moav, Omer,
"Ability-biased technological transition, wage inequality, and economic growth"
Open Publications at Brown.
Brown Digital Repository. Brown University Library.
https://doi.org/10.1162/003355300554827
This collection contains public access and open access versions of scholarly publications authored and deposited by Brown University scholars, including faculty publications in compliance with the Brown Faculty Open Access Policy
Faculty and student publications include open access articles and …
