The position of low skilled workers in the labor market has deteriorated significantly over the past three decades. What has caused this deterioration in low skilled labor demand and what can explain the different labor market responses throughout the OECD? Mark Sanders addresses these questions and evaluates proposed policies to improve upon the present situation and prevent further deterioration in the future. The author develops a theoretical framework that produces two hypotheses to explain the shift in relative demand as well as the different ways in which this shift has manifested itself. The framework is then extended by introducing unemployment, and additional hypotheses are proposed to explain the main EU-US differences. The dynamics thus uncovered yield somewhat unorthodox policy implications on income-, labor market and technology policies in Europe and the US. This comprehensive book will appeal to both scholars and academics, while graduate and PhD-students looking for an accessible introduction to modeling the dynamics of technical change and its interactions with the labor market will find it of great interest.

This paper uses a DSGE model to simulate the impact of technological change on labor markets and income distribution. It finds that technological advances offers prospects for stronger productivity and growth, but brings risks of increased income polarization. This calls for inclusive policies tailored to country-specific circumstances and preferences, such as investment in human capital to facilitate retooling of low-skilled workers so that they can partake in the gains of technological change, and redistributive policies (such as differentiated income tax cuts) to help reallocate gains. Policies are also needed to facilitate the process of adjustment.

This book provides a detailed investigation into the decline in wages and employment of less skilled workers as a key factor underlying the social exclusion in Europe and North America.

In this text the author argues that rapid technological change, sluggish real wage growth, and widening inequality have characterized earlier periods of economic growth of revolutionary new technologies.

Exploring a new agenda to improve outcomes for American workers As the United States continues to struggle with the impact of the devastating COVID-19 recession, policymakers have an opportunity to redress the competition problems in our labor markets. Making the right policy choices, however, requires a deep understanding of long-term, multidimensional problems. That will be solved only by looking to the failures and unrealized opportunities in anti-trust and labor law. For decades, competition in the U.S. labor market has declined, with the result that American workers have experienced slow wage growth and diminishing job quality. While sluggish productivity growth, rising globalization, and declining union representation are traditionally cited as factors for this historic imbalance in economic power, weak competition in the labor market is increasingly being recognized as a factor as well. This book by noted experts frames the legal and economic consequences of this imbalance and presents a series of urgently needed reforms of both labor and anti-trust laws to improve outcomes for American workers. These include higher wages, safer workplaces, increased ability to report labor violations, greater mobility, more opportunities for workers to build power, and overall better labor protections. Inequality in the Labor Market will interest anyone who cares about building a progressive economic agenda or who has a marked interest in labor policy. It also will appeal to anyone hoping to influence or anticipate the much-needed progressive agenda for the United States. The book's unusual scope provides prescriptions that, as Nobel Laureate Joseph Stiglitz notes in the introduction, map a path for rebalancing power, not just in our economy but in our democracy.

From the Industrial Revolution to the age of artificial intelligence, Carl Benedikt Frey offers a sweeping account of the history of technological progress and how it has radically shifted the distribution of economic and political power among society's members. As the author shows, the Industrial Revolution created unprecedented wealth and prosperity over the long run, but the immediate consequences of mechanization were devastating for large swaths of the population.These trends broadly mirror those in our current age of automation. But, just as the Industrial Revolution eventually brought about extraordinary benefits for society, artificial intelligence systems have the potential to do the same. Benedikt Frey demonstrates that in the midst of another technological revolution, the lessons of the past can help us to more effectively face the present. --From publisher description.

Demand for less skilled workers plummeted in developed countries in the 1980s. In open economies, pervasive skill biased technological change (SBTC) can explain this decline. The more countries experiencing a SBTC the greater its potential to decrease local demands for unskilled labor by increasing the world supply of unskilled-intensive goods. We find strong evidence for pervasive SBTC in developed countries. Most industries increased the proportion of skilled workers despite generally rising or stable relative wages. Moreover, the same manufacturing industries simultaneously increased demand for skills in different countries. Many developing countries also show increased skill premia, a pattern consistent with SBTC.