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This paper documents the pervasiveness of job polarization in 16 Western European countries over the period 1993-2010. It then develops and estimates a framework to explain job polarization using routine-biased technological change and offshoring. This model can explain much of both total job polarization and the split into within-industry and between-industry components.

This paper shows that the United Kingdom since 1975 has exhibited a pattern of job polarization with rises in employment shares in the highest- and lowest-wage occupations. This is not entirely consistent with the idea of skill-biased technical change as a hypothesis about the impact of technology on the labor market. We argue that the \"routinization\" hypothesis recently proposed by Autor, Levy, and Murnane (2003) is a better explanation of job polarization, though other factors may also be important. We show that job polarization can explain one-third of the rise in the log(50/10) wage differential and one-half of the rise in the log(90/ 50).

This paper gives an overview of current thinking by economists about the consequences of ongoing technological progress for labour markets, and discusses policy implications. In economics, the impact of technological progress on labour markets is understood by the following two channels: (i) the nature of interactions between differently skilled workers and new technologies affecting labour demand and (ii) the equilibrium effects of technological progress through consequent changes in labour supply and product markets. The paper explains how the ongoing Digital Revolution is characterized by a complex interplay between worker skills and digital capital in the workplace, and consequent changes in job mobility for workers and in output prices affecting consumer demand for goods and services. In particular, it explains how current worker–technology interactions and the equilibrium effects they entail combine to create economy-wide job polarization with winners and losers from ongoing technological progress. The paper therefore concludes by discussing a set of policy interventions to ensure that the benefits of the Digital Revolution are broadly shared.

Student evaluations of teaching (SETs) are widely used to measure teaching quality in higher education and compare it across different courses, teachers, departments and institutions. Indeed, SETs are of increasing importance for teacher promotion decisions, student course selection, as well as for auditing practices demonstrating institutional performance. However, survey response is typically low, rendering these uses unwarranted if students who respond to the evaluation are not randomly selected along observed and unobserved dimensions. This paper is the first to fully quantify this problem by analyzing the direction and size of selection bias resulting from both observed and unobserved characteristics for over 3000 courses taught in a large European university. We find that course evaluations are upward biased, and that correcting for selection bias has non-negligible effects on the average evaluation score and on the evaluation-based ranking of courses. Moreover, this bias mostly derives from selection on unobserved characteristics, implying that correcting evaluation scores for observed factors such as student grades does not solve the problem. However, we find that adjusting for selection only has small impacts on the measured effects of observables on SETs, validating a large related literature which considers the observable determinants of evaluation scores without correcting for selection bias.

Since the early 1990s Europe, like the United States and the United Kingdom, has experienced job polarization, that is, a disproportionate increase in high-paid and low-paid employment. Pervasive job polarization is in line with the evidence that in advanced countries, technologies are becoming more intense in the use of nonroutine tasks concentrated in high-paid and low-paid service jobs, at the expense of routine tasks concentrated in manufacturing and clerical work. The evidence for alternative explanations--offshoring and inequality--is much weaker.

This paper uses historical labour market data for Belgium for the period 1846–2011 to illustrate how the employment impacts of the ongoing Digital Revolution after 1980 compare to those of the Second Industrial Revolution before 1980. Our analyses show that the period 1846–1947 was characterized by economy-wide skill-upgrading due to an increase in the demand for skilled relative to unskilled workers because of skill-biased technological change (SBTC). The period 1947–81 is characterized by particularly high labour market turbulence, in part due to a gradual switch from economywide skill-upgrading to job polarization. Consequently, the impact of the ongoing Digital Revolution on labour markets after 1980 is not uniquely characterized by exceptionally high labour market turbulence but by the nature of changes in the composition of jobs, namely a process of job polarization. To explain job polarization, the paper discusses the hypothesis of Routine-Biased Technological Change (RBTC) that has recently emerged in the academic literature.

Studying firm-level adjustments is important for understanding the economic effects of workplace automation. So far, emerging firm-level evidence is focused on robotics and the manufacturing sector. In this paper, we document that the adoption of automation technologies extends beyond manufacturing firms. We identify firm-level automation events and show that automating firms experience faster employment and revenue growth than do nonautomating firms. However, around automation events themselves, employment growth slows markedly. Notably, we find that these effects are similar for manufacturing and nonmanufacturing firms, suggesting that an increasing diffusion of automation technology has important consequences for firms and their workers.

This paper shows that the United Kingdom since 1975 has exhibited a pattern of job polarization with rises in employment shares in the highest- and lowest-wage occupations. This is not entirely consistent with the idea of skill-biased technical change as a hypothesis about the impact of technology on the labor market. We argue that the 'routinization' hypothesis recently proposed by Autor, Levy, and Murnane (2003) is a better explanation of job polarization, though other factors may also be important. We show that job polarization can explain one-third of the rise in the log(50/10) wage differential and one-half of the rise in the log(90/50). Reprinted by permission of the MIT Press

Chapter I, \"Lousy and lovely jobs: the rising polarization of work in Britain\", shows that the UK since 1975 has exhibited a pattern of job polarization with rises in employment shares in the highest- and lowest-wage occupations. This is not entirely consistent with the standard view of skill-biased technical change as a hypothesis about the impact of technology on the labor market. However, a more nuanced view of skill-biased technological change recently proposed by Autor, Levy and Murnane [2003] (ALM) is a better explanation of job polarization. ALM argue persuasively that technology can replace human labor in routine tasks, be they manual or cognitive, but (as yet) cannot replace human labor in non-routine tasks. Since non-routine tasks are concentrated at both ends of the earnings distribution, it is shown that ALM's routinization hypothesis can explain one-third of the rise in the log(50/10) and one-half of the rise in the log(90/50) wage differential. Chapter II, \"The impact of shop closing hours on labor and product markets\", adds to a small but growing literature related to the idea that product market regulation affects employment. More specifically, it is argued that shop closing hours can affect the level and composition of employment in retail industries. First, this chapter exploits recent changes in US Sunday Closing Laws to find that total employment, total revenue and the number of shops increase in deregulating industries and possibly decrease in non-deregulating industries. Second, building on what we know about retail markets, a model is presented to show how consumer behavior and retail competition can explain the observed impact of deregulation on retail labor and product markets and therefore ultimately employment. Chapter III, \"The recent expansion of higher education in Britain, college premiums and wage inequality\", examines the impact of changes in the relative supply of college workers on college premiums and wage inequality between 1975 and 2003 in the UK. First, it provides a test for the hypothesis proposed by Card and Lemieux [2001] (CL) that the inter-cohort slowdown in college attainment growth rates explains the higher college premiums for cohorts born between 1955 and 1970. More precisely, the chapter examines the expansion of Britain's higher education system between 1988 and 1994 to find lower relative earnings for college graduates born between 1970 and 1976, in line with the CL hypothesis. Second, accounting for a positive time trend in college attainment and a secular increase in the relative demand for college workers, it is shown that the slowdown in educational attainment for cohorts born between 1955 and 1970 can explain an important part of the increase in the average college premium and a significant part of the increase in wage inequality after 1980. Relative to the secular increase in the demand for and supply of college workers, the recent expansion of Britain's higher education system is thus expected to significantly reduce the average college premium and therefore wage inequality. Chapter IV, \"Cyclicality and fixed effects in gross job flows: a European cross country analysis\", uses information on manufacturing establishments during the 1990s in Belgium, France, Italy and the UK to examine whether time series of employment dynamics behave differently across countries and whether persistent differences exist in gross job flows that are country or industry specific. The results suggest job destruction is more cyclically volatile in the UK compared to Continental European countries. In the longer-run, a country fixed effect best captures the process of job reallocation whereas industry specific differences are not important. Symmetry of job creation and destruction over the business cycle and the existence of country specific differences in gross job flows most likely reflect the importance of different labor market regulations in Continental European countries.