The Skill Complementarity of Broadband Internet / Anders Akerman, Ingvil Gaarder, Magne Mogstad.

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Akerman, Anders

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Material type: Text

TextSeries: Working Paper Series (National Bureau of Economic Research) ; no. w20826.Publication details: Cambridge, Mass. National Bureau of Economic Research 2015.Description: 1 online resource: illustrations (black and white)Subject(s):

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Abstract: Does adoption of broadband internet in firms enhance labor productivity and increase wages? And is this technological change skill biased or factor neutral? We exploit rich Norwegian data to answer these questions. A public program with limited funding rolled out broadband access points, and provides plausibly exogenous variation in the availability and adoption of broadband internet in firms. Our results suggest that broadband internet improves (worsens) the labor outcomes and productivity of skilled (unskilled) workers. We explore several possible explanations for the skill complementarity of broadband internet. We find suggestive evidence that broadband adoption in firms complements skilled workers in executing nonroutine abstract tasks, and substitutes for unskilled workers in performing routine tasks. Taken together, our findings have important implications for the ongoing policy debate over government investment in broadband infrastructure to encourage productivity and wage growth.

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Working Paper	Biblioteca Digital	Colección NBER	nber w20826 (Browse shelf(Opens below))	Not For Loan

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Previous	nber w20823 Segmented Housing Search /	nber w20824 Central Bank Credibility: An Historical and Quantitative Exploration /	nber w20825 Exploration for Human Capital: Evidence from the MBA Labor Market /	nber w20826 The Skill Complementarity of Broadband Internet /	nber w20827 Austerity in 2009-2013 /	nber w20828 The Fluidity of Race: “Passing” in the United States, 1880-1940 /	nber w20829 Patronage Politics and the Development of the Welfare State: Confederate Pensions in the American South /	Next

January 2015.

Does adoption of broadband internet in firms enhance labor productivity and increase wages? And is this technological change skill biased or factor neutral? We exploit rich Norwegian data to answer these questions. A public program with limited funding rolled out broadband access points, and provides plausibly exogenous variation in the availability and adoption of broadband internet in firms. Our results suggest that broadband internet improves (worsens) the labor outcomes and productivity of skilled (unskilled) workers. We explore several possible explanations for the skill complementarity of broadband internet. We find suggestive evidence that broadband adoption in firms complements skilled workers in executing nonroutine abstract tasks, and substitutes for unskilled workers in performing routine tasks. Taken together, our findings have important implications for the ongoing policy debate over government investment in broadband infrastructure to encourage productivity and wage growth.