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The Endogenous Skill Bias of Technical Change and Inequality in Developing Countries, Alberto Behar

This paper draws on existing empirical literature and an original theoretical model to argue that globalization and skill supply affect the extent to which technology adoption in developing countries favors skilled workers. Developing countries are experiencing technical change that is skill-biased because skill-biased technologies are becoming relatively cheaper. Increased skill supply further biases technical change in favor of skilled labor. Free trade induces technology that favors skilled workers in skill-abundant developing countries and that favors unskilled workers in skill-scarce developing countries, and therefore amplifies the predicted wage effects of trade liberalization. These features aid our understanding of the observed rises in inequality within developing countries and the absence of a significant downward effect of expanded educational attainment on skill premia. They also help account for the large and differential effects of trade liberalization on inequality. These findings are pertinent for the Middle East and North Africa because of its recent increase in trade openness and remarkable rise in educational attainment
Table Of Contents
Cover; Contents; I. Introduction; II. Empirical Backround; A. Patterns of Income Differentials; Inequality Over Time; Tables; 1: Projections of Inequality on Education, Trade and Time for Developing Countries; Inequality and Schooling; 2: Increase in Inequality, MENA, 1980s to 2000s; 3: MENA Countries with Large Rises in Educational Attainment, 1980-2010; Inequality and Trade; 4: Change in Trade Openness, MENA, 1980-2010; B. Drivers of Skill-biased Technical Change; Intrinsic versus Endogenous Skill Bias; Determinants of the Skill Bias of Technology; III. Theory; A. Production
Literary Form
non fiction
February 2013
Physical Description
1 online resource (32 p.)
Specific Material Designation
Form Of Item

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