"The Comparative Advantage of Educated Workers in Implementing New Technology"

© Review of Economics and Statistics, February 1987
Volume: 69 | Issue: 1 | Pages: 1-11

Publication type: Journal article

Research Archive Topic: Business Economics and Public Policy, Media and Technology

Abstract

We estimate labor demand equations derived from a (restricted variable) cost function in which "experience" on a technology (proxied by the mean age of the capital stock) enters "non-neutrally." Our specification of the underlying cost function is based on the hypothesis that highly educated workers have a comparative advantage with respect to the adjustment to and implementation of new technologies. Our empirical results are consistent with the implication of this hypothesis, that the relative demand for educated workers declines as the ages of plant and (particularly) of equipment increase, especially in R & D-intensive industries

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