IDEAS home Printed from https://ideas.repec.org/a/bla/scotjp/v55y2008i3p330-352.html
   My bibliography  Save this article

Biased Technological Shocks, Relative Wage Rigidities And Low‐Skilled Unemployment

Author

Listed:
  • Olivier Pierrard
  • Henri R. Sneessens

Abstract

The contrast between the evolution over the last decades of the European Union (EU) and the US unemployment rates, especially for the low‐skilled, is well known. A consensus view is that these different outcomes can be explained by the interactions between common shocks and specific institutional setups. In this paper, we emphasize the interactions between technological changes and wages rigidities. We construct a fully calibrated general equilibrium model with two types of jobs and two types of workers, and with search unemployment. Our simulations show that with wage rigidities, technological changes suffice to generate a continuous rise in the low‐skilled unemployment rate and an almost unchanged high‐skilled unemployment rate. Without wage rigidities, the unemployment rates remain unchanged but the wage dispersion widens.

Suggested Citation

  • Olivier Pierrard & Henri R. Sneessens, 2008. "Biased Technological Shocks, Relative Wage Rigidities And Low‐Skilled Unemployment," Scottish Journal of Political Economy, Scottish Economic Society, vol. 55(3), pages 330-352, July.
    • Handle: RePEc:bla:scotjp:v:55:y:2008:i:3:p:330-352
    DOI: 10.1111/j.1467-9485.2008.00456.x
    as

    Download full text from publisher

    File URL: https://doi.org/10.1111/j.1467-9485.2008.00456.x
    Download Restriction: no
    File URL: https://libkey.io/10.1111/j.1467-9485.2008.00456.x?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Batyra, Anna & Sneessens, Henri R., 2010. "Selective reductions in labor taxation: Labor market adjustments and macroeconomic performance," Journal of Policy Modeling, Elsevier, vol. 32(4), pages 531-543, July.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:bla:scotjp:v:55:y:2008:i:3:p:330-352. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Wiley Content Delivery (email available below). General contact details of provider: https://edirc.repec.org/data/sesssea.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.