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Technological progress and wage inequality in an economy with a segmented labor market

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  • Shigemi Yabuuchi

    (Aichi University)

Abstract

We examine the effect of technological progress on the wage gap between skilled and unskilled labor. Furthermore, we apply Beladi et al.'s (2012) analysis of technological progress and informal workers to the problem of wage inequality between skilled and unskilled labor. We conclude that technological progress in the organized sector will harm informal workers, while progress in the unorganized sector will benefit them. Additionally, we find that the effect of labor-saving technological progress on the wage gap depends on the industries' relative factor intensities.

Suggested Citation

  • Shigemi Yabuuchi, 2015. "Technological progress and wage inequality in an economy with a segmented labor market," Economics Bulletin, AccessEcon, vol. 35(3), pages 1992-1999.
    • Handle: RePEc:ebl:ecbull:eb-15-00256
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    References listed on IDEAS

    as
    1. Shigemi Yabuuchi, 2009. "Emigration and wage inequality in a dual economy," Economics Bulletin, AccessEcon, vol. 29(3), pages 1549-1554.
    2. Harris, John R & Todaro, Michael P, 1970. "Migration, Unemployment & Development: A Two-Sector Analysis," American Economic Review, American Economic Association, vol. 60(1), pages 126-142, March.
    3. Chaudhuri, Sarbajit & Yabuuchi, Shigemi, 2007. "Economic liberalization and wage inequality in the presence of labour market imperfection," International Review of Economics & Finance, Elsevier, vol. 16(4), pages 592-603.
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    7. Hamid Beladi & Sarbajit Chaudhuri & Shigemi Yabuuchi, 2008. "Can International Factor Mobility Reduce Wage Inequality in a Dual Economy?," Review of International Economics, Wiley Blackwell, vol. 16(5), pages 893-903, November.
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    More about this item

    Keywords

    Technological progress; Wage inequality; Skilled and unskilled labor;
    All these keywords.

    JEL classification:

    • F1 - International Economics - - Trade
    • J3 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs

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