Computers as Stepping Stones? Technological Change and Equality of Labor Market Opportunities

This  paper  analyzes  whether  technological  change  improves  equality  of  labormarket opportunities by increasing the returns to skills relative to the returns toparental background.  We find that in Germany during the 1990s, the introductionof computer technologies improved the access to technology-adopting occupationsfor workers with low-educated parents, and reduced their wage penalty within theseoccupations.  We also show that this significantly contributed to a decline in theoverall  wage  penalty  experienced  by  workers  from  disadvantaged  parental  back-grounds over this time period.  Competing mechanisms, such as skill-specific laborsupply shocks and skill-upgrading, do not explain these findings.

Arntz, Melanie, Cäcilia Lipowski, Guido Neidhöfer and Ulrich Zierahn-Weilage (2025), Computers as Stepping Stones? Technological Change and Equality of Labor Market Opportunities, Journal of Labor Economics