Does Skill-Biased Technical Change Diffuse Internationally?
Patrick Schulte
TL;DR: This study examines the international diffusion of skill-biased technical change, finding that it contributes to increasing skill demand in other countries, with bilateral distance and technological frontier proximity being key factors in this process.
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Abstract: This paper studies the question whether skill-biased technical change diffuses internationally and that way contributes to the increasing relative skill demand in other countries. So far, the role of skill-biased technology diffusion has hardly been studied empirically. Using new sectoral data for a panel of 40 emerging and developed countries, 30 industries (covering manufacturing and service industries) and 13 years (1995-2007), the analysis shows that skill-biased technology diffusion is statistically and economically important in explaining skill-biased technical change. Countries further away from the skill-specific technological frontier subsequently show higher skill-specific productivity growth. For that, the bilateral distance between two countries proves to be an important mediating factor, whereas intersectoral trade linkages, so far, explain only a small part of it. The main results hold for both, developed and emerging countries.
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References
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