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A Theory of Defensive Skill Biased Innovation and Globalization

A Theory of Defensive Skill Biased Innovation and Globalization
A Theory of Defensive Skill Biased Innovation and Globalization
This paper considers a dynamic model of innovations in which firms can endogenously bias the direction of technological change. Both in a North-North and North-South context, we show that, when globalization triggers an increased threat of technological leapfrogging or imitation, firms tend to respond to that threat by biasing the direction of their innovations towards skilled-labor-intensive technologies.
We show that this process of defensive skill-biased innovations generates an increase in wage inequalities in both regions. We then discuss suggestive empirical evidence of the existence of defensive skill-biased technical change.
709-728
Thoenig, Mathias
854fdd04-6cec-487a-bf2b-377e510e1713
Verdier, Thierry
87c483ea-f473-408f-9776-d0381cab6454
Thoenig, Mathias
854fdd04-6cec-487a-bf2b-377e510e1713
Verdier, Thierry
87c483ea-f473-408f-9776-d0381cab6454

Thoenig, Mathias and Verdier, Thierry (2003) A Theory of Defensive Skill Biased Innovation and Globalization. American Economic Review, 93 (3), 709-728. (doi:10.1257/000282803322157052).

Record type: Article

Abstract

This paper considers a dynamic model of innovations in which firms can endogenously bias the direction of technological change. Both in a North-North and North-South context, we show that, when globalization triggers an increased threat of technological leapfrogging or imitation, firms tend to respond to that threat by biasing the direction of their innovations towards skilled-labor-intensive technologies.
We show that this process of defensive skill-biased innovations generates an increase in wage inequalities in both regions. We then discuss suggestive empirical evidence of the existence of defensive skill-biased technical change.

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Published date: 2003

Identifiers

Local EPrints ID: 33477
URI: https://eprints.soton.ac.uk/id/eprint/33477
PURE UUID: 7a5cabf2-2c5a-423b-a552-bbe760a769ca

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Date deposited: 16 May 2006
Last modified: 17 Jul 2017 15:52

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