Information Technology, Skilled Labor, and Factor Substitution: Evidence from the Healthcare Industry
نویسندگان
چکیده
Information technologies (IT) may substitute for routine/manual tasks and complement complex/problem-solving tasks, which can induce bias towards greater demand for skilled labor. This phenomenon of “skill-biased technical change” has important implications for the impact of IT on factor substitution within a firm’s production process. Understanding how the substitution and complementarity relationships depend on the skill levels of labor has not been adequately addressed in the IS and economics literature. Using firm-level panel data from California hospitals from 2002-2006, we specified a translog production function and estimated elasticities of substitution between IT spending and skilled vs. unskilled labor. We found that IT is a substitute for capital and low-skilled labor, but is a complement for high-skilled labor. Additionally, the complementarity effect of IT on high-skilled labor is stronger in magnitude than the substitution effect on low-skilled labor. Our results suggest the impact of IT on labor is non-uniform and skill-biased, favoring high-skilled workers over low-skilled workers.
منابع مشابه
Effects of R&D and Technology Imports on Employment: The Case of Iran
Domestic innovations and technology imports play important roles in boosting relative demand for skilled labor force. These factors are in turn influenced by domestic R&D investments and international trade. Using a translog cost function, this paper studies the effect of technology imports and other factors including output level and physical capital stock on the shares of skilled labor force ...
متن کاملNew Goods and the Relative Demand for Skilled Labor
This paper provides data on the output and factor payments of new goods for every 4-digit industry in the U.S. manufacturing sector in the late 1970s and 1980s. For the entire manufacturing sector, the new goods’ average skilled-labor intensity exceeds the old goods’ by over 40%, and new goods can account for about 30% of the increase in the relative demand for skilled labor. Since new goods pr...
متن کاملThe Effect of Education on Industrial Development (Evidence from Iranian Small Industries)
The literature show evidence that small manufacturing enterprises (SMEs) are understood as main source of technology development and employment creation. At the same time they are vulnerable to a number of restrictions such as access to finances, skilled labor and public support, while are exposed to high competition and suffer from low survival rate. This research aims to shed lights on the ro...
متن کاملThe Impact of International Migration on the Economy with the Assumption of Labor Heterogeneity
T his study investigated the effect of international labor migration on Iran’s economy using a neo-classical growth model with the assumption of labor heterogeneity within the framework of dynamic stochastic general equilibrium model. After solving the model, the obtained equations were linearized and different values were assigned to the parameters according to Iran’s economy inform...
متن کاملSkill Biased Technical Change and Rising Inequality: What is the Evidence? What are the Alternatives?
In this lecture, we address the evidence on the Skill Biased Technical Change hypothesis. There are at least Þve class of theories that I can discern, and I'll say something about each time permitting: 1. Capital skill complementarity 2. Correlations and timing: Computer technology and skill upgrading 3. Characteristics of technology and tasks: Changes in the organization of work 4. Nelson/Phel...
متن کامل