Technological Complexity, Wage Differentials and Unemployment

16 Pages Posted: 12 May 2003

See all articles by Alberto Dalmazzo

Alberto Dalmazzo

University of Siena - Department of Economics

Abstract

A model is developed to analyse the relation between wages and technological complexity, as characterised by the "O-ring" theory of production. In equilibrium, the adoption of a relatively complex technology induces the employer to pay higher wages. We argue that the model can explain increased within-group wage inequality as a consequence of increased technological heterogeneity among firms.

Suggested Citation

Dalmazzo, Alberto, Technological Complexity, Wage Differentials and Unemployment. Available at SSRN: https://ssrn.com/abstract=371853

Alberto Dalmazzo (Contact Author)

University of Siena - Department of Economics ( email )

Piazza S. Francesco, 7
Siena, I-53100
Italy
+39 0577 232 697 (Phone)

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