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The Technological Progress of Regional Industry and Local Employment Growth

Choi, Jihye 1 KIM, ILTAE 1

1전남대학교

Accredited

ABSTRACT

This study examines the effect of technological progress in regional industry on local employment growth in Korea during 2000~2014 using regional TFP(Total Factor Productivity) as proxy for technological progress representing improvement of productivity. This study classifies three types of technological progress; factor-neutral technological progress, capital-saving technological progress, and labor-saving progress. This study shows that the effect of three types of technological progress on employment is negative since the substitution effect induced by technological progress offsets the scale effect. This implies that a decrease in cost by technological progress does not fully lead to a reduction in price. This study suggests that regional industry policy should focuses on technological progress of regional industry producing price elastic and income elastic goods to enhance domestic demand and local employment growth.

Citation status

* References for papers published after 2022 are currently being built.