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The knowledge economy at the turn of the twentieth century: the emergence of hierarchies

Garicano, Luis and Rossi-Hansberg, Esteban (2006) The knowledge economy at the turn of the twentieth century: the emergence of hierarchies. Journal of the European Economic Association, 4 (2-3). pp. 396-403. ISSN 1542-4774

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Identification Number: 10.1162/jeea.2006.4.2-3.396


We use a simplified version of Garicano and Rossi-Hansberg (2005) to understand the impact of improvements in communications technology at the turn of the twentieth century on wages and organization. Improvements in communication technology allow individuals of different skills to abandon self-employment and form teams with each other. In particular, they allow high-skill agents to leverage their knowledge by specializing in the hardest tasks and hiring low-skill agents to do the routine tasks. Organization then exploits the complementarities between individual skills, which in turn affects the distribution of earnings.

Item Type: Article
Official URL:
Additional Information: © 2009 The MIT Press
Divisions: Management
Centre for Economic Performance
Subjects: H Social Sciences > HC Economic History and Conditions
JEL classification: L - Industrial Organization > L2 - Firm Objectives, Organization, and Behavior
N - Economic History > N3 - Labor and Consumers, Demography, Education, Health, Income, and Wealth
D - Microeconomics > D2 - Production and Organizations
J - Labor and Demographic Economics > J3 - Wages, Compensation, and Labor Costs
Date Deposited: 27 Oct 2009 17:04
Last Modified: 16 May 2024 00:29

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