|Submitted Working Papers|
The March of the Techies: Technology, Trade, and Job Polarization in France, 1994-2007
Abstract: Using administrative employee-firm-level data from 1994 to 2007, we show that the labor market in France has become polarized: employment shares of high and low wage occupations have grown, while middle wage occupations have shrunk. During the same period, the share of hours worked in technology-related occupations ("techies") grew substantially, as did imports and exports, and we explore the causal links between these trends. Our paper is the first to analyze polarization in any country using firm-level data. Our data includes hours worked classified into 22 occupations, as well as imports and exports, for every private sector firm. We show that polarization is pervasive: it has occurred within the nonmanufacturing and manufacturing sectors, and both within and between firms. Motivated by the fact that technology adoption is mediated by technically qualified managers and technicians, we use an innovative measure of the propensity to adopt new technology: the firm-level employment share of techies. Using the subsample of firms that are active over the whole period, we show that firms with more techies in 2002 saw greater polarization from 2002 to 2007. Firm-level trade also contributes to polarization. To control for the endogeneity of firm-level techies and trade in 2002, we use values of techies and trade from 1994 to 1998 as instruments. We also show that firms with more techies in 2002 grew more rapidly from 2002 to 2007, using the same instrumental variable strategy. We conclude that technological change, mediated through techies, is an important cause of polarization in France. Trade was also important, mainly in manufacturing.
The Multinational Wage Premium and Wage Dynamics
Abstract: Using detailed administrative data linking French firms and workers over the years 2002- 2007, we document a distinct U-shaped pattern in worker-level wages surrounding the time their employer is acquired by a foreign firm, with a dip in earnings observed for several years before domestic firms switch to MNE status. This pre-acquisition decline in earnings can partly explain why prior evidence found no impact of foreign ownership on worker-level wages. Accounting for the pre-acquisition earnings dip and other confounding wage dynamics we find that MNEs increase remuneration to workers by 4.8% initially, and by 6%-8% after several years. Unique information about in-kind payments reveals that bonuses and other non-monetary remuneration also exhibit a U-shaped pattern surrounding foreign acquisition.
Third Round Revise and Resubmit at The Journal of Economic Growth
Abstract: We study the role of trade liberalization, democratization and their interaction for technology adoption. A general equilibrium theory with heterogeneous skills predicts a complementarity between trade and democracy in creating demand for superior technologies and political incentives to facilitate their adoption. This is the case because unbalanced regime changes may harm and therefore lead to vested interests of the decisive political actors represented by the rentier elites in autocracies and workers in democracies. We use panel data on manufacturing productivity and on technology adoption, at a disaggregated level, for the period 1980-2000. We exploit within country variation over time and the heterogeneous timing of trade liberalization and democratization. The results suggest the existence of a positive interaction between trade openness and democratization for technology adoption. The result that transitions to open democracies are beneficial for the technological dynamics is robust to a large set of robustness checks.