IMPLICATIONS OF THE TECHNOLOGY INNOVATIONS ON THE SOCIAL PLAN
IMPLICATIONS OF THE TECHNOLOGY INNOVATIONS ON THE SOCIAL PLAN

Summary/Abstract: Skill Biased Technological Changes (SBTC) constitutes changes in technology of production that promotes skilled labor more than unskilled workforce by increasing its relative productivity and, subsequently, its relative demand. Traditionally, technical change is considered neutral factor. However, the rapid increase observed in the relative wage of skilled workers means that recent technological change was biased expertise. This increases the skill premium. The theories and the data suggest that new information technologies are complementary with skilled labor, at least in their dissemination phase. The bias factor attributed puts technological change a central issue of income distribution. But in addition to the increase in demand for skills, we observe an increase in the supply of skills. This leaves the skill premium in cyclic evolution.

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