If a technological change lowers the wage of unskilled workers,it is an example of ________ technological change.

Question

Quizplus · Accepted Answer

A skill-biased technological change refers to a change in technology that increases the demand for skilled labor relative to unskilled labor. In this scenario, since the technological change lowers the wage of unskilled workers, it implies that the demand for unskilled labor has decreased relative to skilled labor. This is consistent with a skill-biased technological change. Option B) is incorrect because if the technological change was unskilled-biased, it would have increased the demand for unskilled labor and hence increased their wage. Option C) and D) are not valid terms in this context.

If a Technological Change Lowers the Wage of Unskilled Workers,it