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Discussion Paper
Does Automation Drive the Labor Market?
In this note we question the emerging view that automation is a primary driver of wage and employment outcomes in labor markets.
Working Paper
Complex-Task Biased Technological Change and the Labor Market
In this paper we study the relationship between task complexity and the occupational wage- and employment structure. Complex tasks are defined as those requiring higher-order skills, such as the ability to abstract, solve problems, make decisions, or communicate effectively. We measure the task complexity of an occupation by performing Principal Component Analysis on a broad set of occupational descriptors in the Occupational Information Network (O*NET) data.We establish four main empirical facts for the U.S. over the 1980-2005 time period that are robust to the inclusion of a detailed set of ...
Working Paper
Use it or Lose it: Efficiency Gains from Wealth Taxation
How does wealth taxation differ from capital income taxation? When the return on investment is equal across individuals, a well-known result is that the two tax systems are equivalent. Motivated by recent empirical evidence documenting persistent heterogeneity in rates of return across individuals, we revisit this question. With such heterogeneity, the two tax systems have opposite implications for both efficiency and inequality. Under capital income taxation, entrepreneurs who are more productive, and therefore generate more income, pay higher taxes. Under wealth taxation, entrepreneurs who ...
Working Paper
Occupational Complexity, Capital-Skill Complementarity, and the Evolution of U.S. Wage Inequality: A Quantitative Analysis
We document a strong, positive relationship between occupational problem complexity, measured from US data on problem-solving requirements, and occupational wage growth since 1980. In contrast, employment shifts toward more complex occupations have been modest, suggesting a race between the demand for and supply of complex skills. We rationalize these findings by formulating and structurally estimating a quantitative general equilibrium model on the granular occupational level. In our model, workers have heterogeneous comparative advantages in solving complex problems and physical capital ...
Working Paper
Occupational Complexity, Capital-Skill Complementarity, and the Evolution of U.S. Wage Inequality: A Quantitative Analysis
We document a strong, positive relationship between occupational problem complexity, measured from US data on problem-solving requirements, and occupational wage growth since 1980. In contrast, employment shifts toward more complex occupations have been modest, suggesting a race between the demand for and supply of complex skills. We rationalize these findings by formulating and structurally estimating a quantitative general equilibrium model on the granular occupational level. In our model, workers have heterogeneous comparative advantages in solving complex problems and physical capital ...