Technological change and wage premiums amongst high-skilled labour

ABSTRACT

This study examines the impact of the steam engine, which produced wide and long-lasting economic growth from the 19^th century to the early 20^th century, on the wages of high-skilled seamen in the Swedish merchant maritime shipping industry. The analysis focuses on the years 1869–1914, which was a transition period during which traditional sailing ships were replaced by steam-powered vessels. The study shows that all high-skilled occupations received wage gains under steam technology. The evidence on wage polarization amongst the high-skill occupations remains subtle, although there is certain evidence that wage premiums vary by occupation.

KEYWORDS:

• Wage premium
• technological change
• high-skilled labour
• historical data

JEL CLASSIFICATION:

• J24
• J31
• O30

Disclosure statement

No potential conflict of interest was reported by the authors.

Notes

¹ The total number of recruitments in the data is ca. 650,000. The number of individual sailors is smaller, as the same men could be recruited several times; see Ojala, Pehkonen, and Eloranta (2016).

² Appendix A provides a glimpse of the data: share of steam vessels by tonnage from 1869 to 1914 (Figure A1) and wages of high-skill occupations for the early (1869–1889) and late periods (1890–1914) of technological adaptation (Figure A2).

³ Due to the small size of the sample, we do not estimate specifications for switchers by occupations and separate periods.