E-learning and Labour Market: Wage-premium Analysis

Abstract

The link between ICT and the demand for high-skilled labour is due to the fact that the introduction of digital technologies alters the skill requirements of occupations in three main ways (Spitz, 2003): 1) ICT capital substitutes repetitive manual and repetitive cognitive activities, 2) ICT capital is complementary to analytic and interactive activities, and 3) ICT capital increases the requirement for computing skills. Within this framework, we have analysed the determinants of labour productivity of individuals that have taken higher education programmes online to test how occupational skill requirements and the degree of ICT adoption by the industry matches skills of online students. In order to do this, we have assumed an implicit relationship between education and ability (Griliches and Mason, 1972), recognizing that online students may acquire specific skills, such as computing skills and abilities related to ICT use. For the empirical analysis we have used a database of degree students from the UOC (Universitat Oberta de Catalunya). The results from our model based on Mincerian equations show three important facts: 1) schooling is not a significant variable to explain wage differentials; 2) experience, understood as previous productivity and production losses avoided, is the most important variable explaining improvement of wages; and 3) ICT skills have a positive and significant effect on wage levels.