Was Mechanization De-Skilling? The Origins of Task-Biased Technical Change
40 Pages Posted: 25 Mar 2011 Last revised: 31 Jan 2012
Date Written: March 18, 2011
Did nineteenth century technology reduce demand for skilled workers in contrast to modern technology? I obtain direct evidence on human capital investments and the returns to skill by using micro-data on individual weavers and an engineering production function. Weavers learned substantially on the job. While mechanization eliminated some tasks and the associated skills, it increased returns to skill on the remaining tasks. Technical change was task-biased, much as with computer technology. As more tasks were automated, weavers’ human capital increased substantially. Although technology increased the demand for skill like today, weavers’ wages eventually increased and inequality decreased, contrary to current trends.
Keywords: Skill-Biased Technical Change, Technology, Engineering Production Function, Mechanization, Human Capital, Wage Inequality, Learning-by-Doing
JEL Classification: J31, N31, O33
Suggested Citation: Suggested Citation