In this paper we study how aggregate output responds to the arrival of a new General Purpose Technology (GPT) by looking at adjustment mechanisms that operate through labor markets. We show that under a wide set of circumstances the arrival of a new GPT that raises long-run output can trigger a...

In this paper we study how aggregate output responds to the arrival of a new General Purpose Technology (GPT) by looking at adjustment mechanisms that operate through labor markets. We show that under a wide set of circumstances the arrival of a new GPT that raises long-run output can trigger a...

Historical background -- I. The traditional approach: The rise of the college wage premium -- Early studies -- Trade versus technology -- Offshoring -- II. Broadening the canvas: Matching workers with jobs -- Regional disparity -- Firm characteristics -- Technology choice -- Residual inequality