Technical change and superstar effects: evidence from the roll-out of television

Konig, Felix Nikolaus (2019) Technical change and superstar effects: evidence from the roll-out of television. CEP Discussion Papers (CEPDP1663). London School of Economics and Political Science. Centre for Economic Performance, London, UK.

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Abstract

Technical change that improves economies of scale can generate fast income growth among top earners at the expense of everyone else. I test this classic “superstar model” in the labor market for entertainers where the historic roll-out of television led to a natural experiment in scale-related technological change. The launch of a local TV station multiplied audiences of top entertainers nearly fourfold and resulted in a 50% increase of the top percentile’s income share, a more right-skewed income distribution, and significant income losses for lower ranked entertainers. The results confirm the predictions of the “superstar model” and are at odds with canonical models of skill-biased technological change.

Item Type:	Monograph (Discussion Paper)
Official URL:	https://cep.lse.ac.uk/_new/publications/discussion...
Additional Information:	© 2019 The Author(s)
Divisions:	Centre for Economic Performance
Subjects:	H Social Sciences > HC Economic History and Conditions H Social Sciences > HD Industries. Land use. Labor
JEL classification:	J - Labor and Demographic Economics > J3 - Wages, Compensation, and Labor Costs > J31 - Wage Level and Structure; Wage Differentials by Skill, Training, Occupation, etc. J - Labor and Demographic Economics > J2 - Time Allocation, Work Behavior, and Employment Determination and Creation; Human Capital; Retirement > J23 - Employment Determination; Job Creation; Demand for Labor; Self-Employment O - Economic Development, Technological Change, and Growth > O3 - Technological Change; Research and Development > O33 - Technological Change: Choices and Consequences; Diffusion Processes D - Microeconomics > D3 - Distribution > D31 - Personal Income, Wealth, and Their Distributions
Date Deposited:	17 Feb 2020 12:42
Last Modified:	11 Dec 2024 19:33
URI:	http://eprints.lse.ac.uk/id/eprint/103450

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