New Technologies, Wages, and Worker Selection.

The authors study the effect of new technologies on wages and employment using a unique panel that matches data on individuals and on their firms. As in the United States, they show that computer users are better paid than nonusers (15-20 percent more). But these workers were already better compensated before the introduction of the new technologies. Total returns to computer use amount to 2 percent. Measurement errors do not affect the authors' estimates. Furthermore, computer users are protected from job losses as long as bad business conditions do not last too long. This result holds even after controlling for possible selection biases. Copyright 1999 by University of Chicago Press.