Imported Skill Biased Technological Change in Developing Countries

This paper discusses the occurrence of skill-enhancing technology import, namely the relationship between imports of embodied technology and widening skill-based employment di¤erentials in low and middle-income countries. GMM techniques are applied to an original panel dataset comprising 28 manufacturing sectors for 23 countries over a decade. Econometric results provide robust evidence of the determinants of widening employment di¤erentials in low and middle-income countries. In particular, the proposed empirical evidence indicates capital-skill complementarity as a possible source of skill-bias, while imported skillenhancing technology emerges as an additional driver of increasing demand for the skilled workers in these countries. — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — – Keywords: Skill Biased Technological Change, Capital Skill Complementarity, GMM estimation, General Industrial Statistics, World Trade Analyzer. JEL classi…cation: F16, J23, J24, O33 Corresponding Author. Tel: +32 22960117; fax: +32 22993502; e-mail: [email protected]