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Techies, Trade, and Skill-Biased Productivity

Harrigan, James; Reshef, Ariell; Toubal, Farid (2021-12), Techies, Trade, and Skill-Biased Productivity. https://basepub.dauphine.psl.eu/handle/123456789/21842

Type
Document de travail / Working paper
Date
2021-12
Publisher
Centre for Economic Policy Research
Series title
CEPR Discussion papers
Series number
15815
Pages
68
Metadata
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Author(s)
Harrigan, James
Paris School of Economics [PSE]
Reshef, Ariell
Centre d'Etudes Prospectives et d'Informations Internationales [CEPII]
Paris School of Economics [PSE]
Toubal, Farid
Centre d'économie de la Sorbonne [CES]
Centre d'Etudes Prospectives et d'Informations Internationales [CEPII]
Center for Economic Policy Research [CEPR]
Abstract (EN)
We study the impact of firm-level choices on ICT, R&D, exporting and importing on the evolution of productivity, its bias towards skilled workers, and implications for labor demand. We use a novel measure of firm-level R&D and ICT adoption: employment of "techies" who perform these tasks. We develop methodology for estimating nested-CES production functions and for measuring both Hicks-neutral and skill-augmenting technology differences at the firm level. Using administrative data on French firms we find that techies, exporting and importing raise skill-biased productivity. In contrast, only ICT techies raise Hicks-neutral productivity. On average, higher firm-level skill biased productivity hardly affects low-skill employment, even as it raises relative demand for skill, due to the cost-reducing effect. ICT accounts for large increases in aggregate demand for skill, mostly due to the effect on firm size, less so through within-firm changes. Exporting, importing, and R&D have smaller aggregate effects.
Subjects / Keywords
Globalization; ICT; labor demand; Outsourcing; productivity; R&D; skill augmenting; Skill bias; STEM skills; techies
JEL
O52 - Europe
J24 - Human Capital; Skills; Occupational Choice; Labor Productivity
J23 - Labor Demand
F66 - Labor
F16 - Trade and Labor Market Interactions
D24 - Production; Cost; Capital; Capital, Total Factor, and Multifactor Productivity; Capacity

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