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Changes in the Demand for Skilled Labor within U. S. Manufacturing: Evidence from the Annual Survey of Manufactures
Abstract
This paper investigates the shift in demand away from unskilled and toward skilled labor in U. S. manufacturing over the 1980s. Production labor-saving technological change is the chief explanation for this shift. That conclusion is based on three facts: (1) the shift is due mostly to increased use of skilled workers within the 450 industries in U. S. manufacturing rather than to a reallocation of employment between industries, as would be implied by a shift in product demand due to trade or to a defense buildup; (2) trade- and defense-demand are associated with only small employment reallocation effects; (3) increased use of nonproduction workers is strongly correlated with investment in computers and in R&D.
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“Therefore, the income distribution becomes dependent on the changes in the skill composition of workers and skill-biased nature of technological progress (see, for instance, Berman et al., 1994;Autor et al., 1998;Piva and Vivarelli, 2004;Acemoglu and Autor, 2011).”
From Financialization and the Labor Share of Income (2019) · cites this paper as Berman et al., 1994
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Walque, D. B. C. M. D., Robyn, P. J., Hamadou, S., Sorgho, G., & Steenland, M. W. (2017) · World Bank, Washington, DC eBooks · doi:10.1596/1813-9450-8162 · Cited by 35
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Haile, G., Srour, I., & Vivarelli, M. (2016) · Eurasian Business Review · doi:10.1007/s40821-016-0051-7 · Cited by 1
“Berman et al. (1994) provided the earliest evidence on the existence of strong correlations between within industry skill upgrading and increased investment in both computer technology and R&D in the US manufacturing sector between 1979 and 1989.”
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Chakraborty, P., & Raveh, O. (2015) · Journal of International Economics · doi:10.1016/j.jinteco.2018.01.003 · Cited by 28
Echeverri‐Carroll, E. L. (1999) · Journal of Knowledge Management · doi:10.1108/13673279910304041 · Cited by 30
“Westney, D.E. (1993), `̀ Country patterns in R&D organization: the United States and Japan'', in Kogut, B. (Ed.)”
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Hitt, L. M., & Brynjolfsson, E. (2002) · The MIT Press eBooks · doi:10.7551/mitpress/5609.003.0007 · Cited by 30
Kaiser, U. (2000) · Economics of Innovation and New Technology · doi:10.1080/10438590000000019 · Cited by 30
“Capital stock is applied by Berman et al. (1994).”
The micro-level dynamics of declining labour share: lessons from the Finnish great leap
Kyyrä, T., & Maliranta, M. (2008) · Industrial and Corporate Change · doi:10.1093/icc/dtn006 · Cited by 29
“Vainiomäki’s method bears a resemblance to that of Berman et al. (1994) with an extension of also including the entry and exit components.”
Isacsson, G. (2005) · RePEc: Research Papers in Economics · Cited by 30
Broadband adoption, jobs and wages in the US telecommunications industry
Majumdar, S. K. (2008) · Telecommunications Policy · doi:10.1016/j.telpol.2008.07.003 · Cited by 29
Spoils of innovation? Employment effects of R&D and knowledge spillovers in Finland
Aldieri, L., Makkonen, T., & Vinci, C. P. (2019) · Economics of Innovation and New Technology · doi:10.1080/10438599.2019.1703754 · Cited by 30
“In order to explore the impacts of innovation on employment and, in particular, on the skill structure of labor demand, we introduce an approach based on a translog cost function (Berman, Bound, and Griliches 1994; Machin and Van Reenen 1998; Hijzen, Görg, and Hine 2005).”
Tax law changes, income-shifting and measured wage inequality: Evidence from India
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“Examples include Berman, Bound, and Griliches (1994) for the United States; Feenstra and Hanson (1997), Revenga (1997), and Hanson and Harrison (1999) for Mexico; and Pavcnik (2003) for Chile.”
Yaşar, M., & Paul, C. J. M. (2007) · Labour Economics · doi:10.1016/j.labeco.2007.01.001 · Cited by 29
Trade, Technology and U.K. Wage Inequality
Haskel, J. E., & Slaughter, M. (1999) · National Bureau of Economic Research · doi:10.3386/w6978 · Cited by 29
“In addition, empirical work on SBTC has documented its pervasiveness across many disaggregated sectors (e.g., Berman, Bound, and Griliches, 1994).”
Changes in Returns to Task-Specific Skills and Gender Wage GapPreprint
Yamaguchi, S. (2012) · SSRN Electronic Journal · doi:10.2139/ssrn.2035833 · Cited by 29
Technology, Unemployment, and Relative Wages in a Global Economy
Davis, D. R. (1996) · National Bureau of Economic Research · doi:10.3386/w5636 · Cited by 29
Is Human Capital Losing From Outsourcing? Evidence for Austria and PolandPreprint
Lorentowicz, A., Marin, D., & Raubold, A. (2005) · RePEc: Research Papers in Economics · doi:10.5282/ubm/epub.13475 · Cited by 29
“In this context outsourcing can be thought as a form of technical change since it acts as an “endogenous technical change”.7 Berman et al (1994) suggested that a translog cost function can be derived from the unit cost function.”
Adoption and use of technology in small business environments
Alonso‐Almeida, M. D. M., & Llach, J. (2011) · Service Industries Journal · doi:10.1080/02642069.2011.634904 · Cited by 28
“…since ICT deployment, use and maintenance calls for specific technological and technical expertise in companies, the need for personnel with new qua-lifications has grown (Berndt, Morrison, & Rosenblum, 1992; Berman et al., 1994; Giuri et al., 2008; Marks & Huzzard, 2010; Piva & Vivarelli, 2004).”
KNOWLEDGE SPILLOVERS, ABSORPTIVE CAPACITY, AND SKILL INTENSITY OF CHILEAN MANUFACTURING PLANTS*
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Inward Greenfield FDI and Patterns of Job Polarization
Amoroso, S., & Moncada-Paternò-Castello, P. (2018) · Sustainability · doi:10.3390/su10041219 · Cited by 28
“While Berman et al. (1994) and Autor et al. (1998) point to technological progress, rather than globalization, as the culprit for income inequality and skill bias, Feenstra and Hanson (1996) and Bernard and Jensen (1997) argue that the outsourcing intermediate inputs by domestic companies and…”
Foreign direct investment and wage inequality: is skill upgrading the culprit?
Tomohara, A., & Yokota, K. (2011) · Applied Economics Letters · doi:10.1080/13504851.2010.491448 · Cited by 28
“Only a few works uses the model with the relative wage term (Berman et al., 1994; Slaughter, 2000).”
Technology and Skill Upgrading: Results from Linked Worker-Plant Data for Finnish Manufacturing
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Anderton, R., Brenton, P. A., & Oscarsson, E. (2002) · Review of World Economics · doi:10.1007/bf02707655 · Cited by 28
“We start from a variable cost function in translog form and assume capital to be a fixed factor of production (see Berman et al. (1993, 1994)): ( ) ( )ln ln ln ln lniC y iY YY iY K iK KK iK= + + + +0 1 2 2 1 2 2α α α β β W ijY iYj j W ikW ijjk kj W ijj j lnlnlnln 2 1 ln δγγ ∑+∑∑+∑+ ++∑+ KYWK…”
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Lin, S. (2003) · RePEc: Research Papers in Economics · Cited by 28
The Arrival of Fast Internet and Employment in Africa
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Competition for private and state school teachers
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“One perspective argues that CBT is intrinsically complementary to skills (Tinbergen 1975; Berman, Bound, and Griliches 1994; Goldin and Katz 1998).”
Is technological change biased towards the unskilled in services? An empirical investigation
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The role of imports in expanding the demand gap between skilled and unskilled labour in the US
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“Baldwin and Cain (2000), by contrast classify employees with 1-12 years of education as unskilled labour and workers with 13 or more years of education as skilled.5 While Berman, Bound, and Griliches (1994) show that identifying skilled and unskilled labour on the basis of job classifications and educational attainmen…”
Zvi Griliches's contributions to the economics of technology and growth
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“Results reported in Table 2 show that consistent with what was observed for other developed (Berman et al. 1994) and developing countries (Pavcnik 2003), variations in both shares mainly occurred within industry rather than between industries in Poland, Hungary, and the Czech Republic.”
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“Davis and Haltiwanger 1991 , Bound and Johnson 1992 , and Berman et al. 1994 also favor Ž .this hypothesis.”
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“See e.g. Juhn et al. (1993), Berman et al. (1994), Gottschalk and Moffit (1994), Nickell and Bell (1996), Doms et al. (1997), Autor et al. (1998), Machin and Van Reenen (1998), Caroli and van Reenen (2001), Goldin and Katz (2001), Card and Dinardo (2002), Autor et al. (2003), Piva et al.…”
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Testing for Factor Price Equality with Unobserved Differences in Factor Quality or Productivity
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“1 See Lemieux (2006) and Autor, Katz, and Kearney (2008).”
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“Contributions include Bernanke (2005, 2011), Caballero et al. (2008), Caballero (2009), Chinn and Ito (2007), Choi et al. (2008), Chinn et al (2012), Eichengreen (2004) and Lee and McKibbin (2007). 9 The American literature critical of China’s macroeconomic policies is also extensive. Bernanke (2005, 2011) offers the…”
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“Recent studies examine the statistical relationship between technology and demand for labor in developed countries using research and development proxies (Berman et al., 1994) and use of computers (Author et al., 1998; Green et al. 2001b) and find a strong positive correlation between them.”
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Metadata
- Authors
- Berman, E., Bound, J., & Griliches, Z.
- Affiliations
- Boston University (US)
- National Bureau of Economic Research (US)
- ORCID
- Venue
- The Quarterly Journal of Economics
- Publisher
- Oxford University Press (OUP)
- Published
- 1994-05-01
- Volume
- 109
- Issue
- 2
- Pages
- 367-397
- ISSN
- 0033-5533 (ISSN-L)
- 1531-4650
- OpenAlex
- W2078001550
- Cited by
- 1,870
- References
- 28
- Citations by year
- 2026: 22 · 2025: 23 · 2024: 25 · 2023: 33 · 2022: 41 · 2021: 45 · 2020: 46 · 2019: 50 · 2018: 38 · 2017: 63 · 2016: 43 · 2015: 73 · 2014: 63 · 2013: 75 · 2012: 55
- FWCI
- 93.64
- Type
- journal article
- Language
- en
- Open access
- closed
- Locations
- The Quarterly Journal of Economics (publishedVersion)
- RePEc: Research Papers in Economics (submittedVersion)
- Funders
- National Science Foundation
- Topics
- Social Sciences › Economics, Econometrics and Finance › Economics and Econometrics › Labor market dynamics and wage inequality
- Social Sciences › Economics, Econometrics and Finance › General Economics, Econometrics and Finance › Global trade and economics
- Social Sciences › Economics, Econometrics and Finance › Economics and Econometrics › Economic Growth and Productivity
- Keywords
- skilled labor demand, manufacturing employment, labor reallocation, defense spending, IT investment, R&D investment
About these checks
Registry, retraction, Cites and statistics results are computed, not judged, with one exception: a printed reference that no index lists is read once by a model before it counts as a citation error. Claims are extracted by a model and kept only when their quote appears verbatim in the text; each cited source is then checked, with a model’s help, for whether it says what the claim relies on. Those verdicts can be wrong — read the claim’s quote and the cited source before relying on one.
Statistics and arithmetic are recomputed, not judged.
Confidence bands are shown only for fields calibrated on our annotated test set. None is calibrated yet, so no band is shown.
What counts as a claim ›How we measure confidence ›How we check this ›
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