Resource title

Supply of skilled labour and organizational change

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The paper develops a model where the structure of organizations is a choice variable for firms and depends on conditions in the labour market. It shows that an increase in the supply of skilled labour may lead firms to adopt organizations with less hierarchical levels. This organizational change increases firms' demand for skilled agents and qualitatively modifies their jobs (i.e. the set of tasks assigned to skilled employees) thus increasing the skilled wage premium.

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en

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http://eprints.lse.ac.uk/35153/

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