Individualism, innovation, and inequality: Exploring the nexus

• Type: Article in International Scientific Journal
• Date: 2025

Authors

Santos, DV (Author) Other; Afonso, Óscar (Author) FEP; Vasconcelos, PB (Author) Other

Journal

Title: Economic Systems

Vol. 49

ISSN: 0939-3625

Publisher: Elsevier

Indexing

ISI Web of Knowledge - 0 Citations

Scopus - 0 Citations

Other information

Authenticus ID: P-016-YV6

DOI: 10.1016/j.ecosys.2024.101252

Abstract (EN): We provide an alternative explanation for the direction of technological change and the related wage inequality between skilled and unskilled workers. To this end, we formulate a skill-biased technological change model in which households' decisions on consumption, savings, and human-capital accumulation are influenced by the level of individualism. We conclude that more individualistic cultures experience higher technological-knowledge bias toward skilled technologies, larger output growth rates, and higher wage inequality between skilled and unskilled workers. We also find that union bargaining only reduces wage inequality between skilled and unskilled at moderate levels of individualism, while introducing redistributive income taxes does not necessarily reduce income inequality.

Language: English

Type (Professor's evaluation): Scientific

No. of pages: 18