Computer Adoption and Returns in Transition

Across nine transition economies, it is the young, educated, English-speaking workers with thebest access to local telecommunications infrastructures that work with computers. Theseworkers earn about 25% more than do workers of comparable observable skills who do not usecomputers. Controlling for likely simultaneity between computer use at work and labor marketearnings makes the apparent returns to computer use disappear. These results are corroboratedusing Russian longitudinal data on earnings and computer use on the job. High costs of computeruse in transition economies suppress wages that firms can pay their workers who use computers.[...]