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Journal of Globalization and Development

Ed. by Stiglitz, Joseph / Emran, M. Shahe / Guzman, Martin / Jayadev, Arjun / Ocampo, José Antonio / Rodrik, Dani

2 Issues per year

Online
ISSN
1948-1837
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Skill-Biased Technology Imports, Increased Schooling Access, and Income Inequality in Developing Countries

Alberto Behar
Published Online: 2012-01-25 | DOI: https://doi.org/10.1515/1948-1837.1091

Why has schooling not countered the pervasive rises in wage inequality driven by skill-biased technical change? Using data and a model of directed technical change in which developing countries acquire technology licenses from abroad, we show technological change is skill-biased in the South simply because it is in the North. This causes permanently rising wage inequality in the South. We model expanded schooling access as producing relatively educated new cohorts of labor market entrants. This makes the market for skill-biased technologies more attractive, which generates accelerated skill-biased technical change, which leads to higher wage inequality and possibly stagnant unskilled wages.

Keywords: skill-biased technical change; income inequality; technology absorption; inclusive growth

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Published Online: 2012-01-25


Citation Information: Journal of Globalization and Development, ISSN (Online) 1948-1837, DOI: https://doi.org/10.1515/1948-1837.1091.

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©2012 Walter de Gruyter GmbH & Co. KG, Berlin/Boston. Copyright Clearance Center

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