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Has Growth in Supply of Educated Persons Been Important for the Composition of Employment?

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Abstract

In the Norwegian fabricated metal industry there has been a shift in demand from unskilled to skilled workers during the period 1972 to 1990, and relative demand for white collar employees has also increased. The paper analyses the factors behind the shift in the composition of these three kinds of labour. A translog cost function approach is applied, using an error-correction representation of the development in cost shares. The results indicate substitutability between unskilled and both skilled and white collar workers. Increased supplies of skilled workers and engineers seem to have been the most important factors for the change in the composition of employment, indicating lack of persons with these kinds of education. In addition, unskilled workers have been rationalized away as a result of technical progress.

Suggested Citation

  • Nils Martin Stølen & Turid Åvitsland, 1997. "Has Growth in Supply of Educated Persons Been Important for the Composition of Employment?," Discussion Papers 187, Statistics Norway, Research Department.
  • Handle: RePEc:ssb:dispap:187
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    File URL: https://www.ssb.no/a/publikasjoner/pdf/DP/dp_187.pdf
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    Keywords

    Labour market; employment composition; human capital; wage differentials; time series analysis.;
    All these keywords.

    JEL classification:

    • J21 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Force and Employment, Size, and Structure
    • J23 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Demand
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials

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