Authors: James A. Kahn and Jong-Soo Lim

This paper examines the role of skilled labor in the growth of total factor productivity. We use panel data from manufacturing industries to assess the extent to which productivity growth in yearly cross section is tied to industry shares of skilled labor inputs. We find robust evidence that productivity growth was increasingly concentrated in high-skill industries during a unique ten-year period beginning in the early 1970s. We do not find any positive association of productivity growth with new capital investment.

For a published version of this report, see James A. Kahn and Jong-Soo Lim, "Skilled Labor-Augmenting Technical Progress in U.S. Manufacturing," Quarterly Journal of Economics 113, no. 4 (November 1998): 1281-1308.