Technological intensity and inter-sectoral dynamics of inequality: evidence from the OECD, 1970-1990 Online publication date: Mon, 18-Aug-2003
by Pedro Conceicao, James K. Galbraith
International Journal of Technology, Policy and Management (IJTPM), Vol. 2, No. 3, 2002
Abstract: Conceicao  found empirical support for a relationship between levels of GDP per capita and levels of inequality conforming to an augmented Kuznets curve, corresponding to a cubic augmentation of the traditional quadratic functional form first proposed by Kuznets . Inspired by Galbraith , we analyse the dynamics of inequality dividing, for each country, the industries into two sectors those that are more technologically intensive are part of the K (for knowledge) sector, with the remaining industries being part of the C (for consumption) sector. We find that the between K and C sectors component of inequality is positively associated with income per capita, the within C sector component is negatively associated with income, and that the K sector component follows a cubic relationship similar to the augmented Kuznets hypothesis. These results help to understand the drivers of the dynamics of overall inequality. As a country grows richer, the earnings in the K sector increase relatively to the C sector. This description of the dynamics of inequality, and its relationship with technology, differs from the skill-biased technological change hypothesis, since technology is not considered to be a ''radio wave'' affecting inequality through the mediation of returns to skills, but rather is considered to be a fundamental, characteristic, differentiating industries in the way they generate profits and earnings.
Online publication date: Mon, 18-Aug-2003
If you are not a subscriber and you just want to read the full contents of this article, buy online access here.Complimentary Subscribers, Editors or Members of the Editorial Board of the International Journal of Technology, Policy and Management (IJTPM):
Login with your Inderscience username and password:
Want to subscribe?
A subscription gives you complete access to all articles in the current issue, as well as to all articles in the previous three years (where applicable). See our Orders page to subscribe.
If you still need assistance, please email email@example.com