Spillovers from High-Skill Consumption to Low-Skill Labor Markets

By F. Mazzolari, Giuseppe Ragusa. Review of Economics and Statistics, 2007

213 citations recorded by the source corpus.

Abstract The least-skilled workforce in the United States is disproportionally employed in the provision of time-intensive services that can be thought of as market substitutes for home production activities. At the same time, skilled workers, with their high opportunity cost of time, spend a larger fraction of their budget in these services. Given the skill asymmetry between consumers and providers in this market, product demand shifts—such as those arising when relative skilled wages increase—should boost relative labor demand for the least-skilled workforce. We estimate that this channel may explain one-third of the growth of employment of noncollege workers in low-skill services in the 1990s.

Subfields: Economics and Econometrics, Gender Studies, General Health Professions

View Paper: https://www.semanticscholar.org/paper/aeff214b09ff10dae124adf6b18b262e91764453

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Citations in the corpus

The Rise of the Machines: Automation, Horizontal Innovation, and Income Inequality (2014, background): “Another explanation for polarization stems from the consumption side and relates the high growth rate of wages for the leastskilled workers with an increase in the demand for services from the most-skilled—and richest—workers, see Mazzolari and Ragusa (2013) and Bárány and Siegel (2014).”
New Frontiers: The Origins and Content of New Work, 1940–2018 (2022, background): “We construct occupation 38Our work is also related to Comin et al. (2020); Leonardi (2015); Mazzolari and Ragusa (2013), who analyze the causal effects of age, education, and income on employment via consumption.”
Job polarization and structural change (2014, background): “In what follows we document each of these facts in detail.”
Disappearing Routine Jobs: Who, How, and Why? (2017, background): “…due to changes in the demographic composition of the economy, or to changes in the propensity to work in routine employment 3See Autor and Dorn (2013) and Mazzolari and Ragusa (2013) who discuss the relation between the rise of non-routine manual employment and the decline in routine employment.”
Do low-skilled workers gain from high-tech employment growth? High-technology multipliers, employment and wages in Britain (2019, background): “But they show a more positive story, we suspect because they reveal the importance of spill-overs into the mid-skilled labour market which are normally the focus of research on low skilled workers (Mazzolari and Ragusa, 2013).”