New technologies, skills obsolescence, and skill complementarity

This paper considers how new technologies affect the returns to experience and how experience affects the adoption of new technologies. Whereas the traditional vintage model emphasizes skill obsolescence generated by imperfect transferability of skills across technologies, we consider the possibility that new technologies complement existing skills. Consistent with the vintage model, among college graduate men, young workers have adopted computers most intensively and the returns to experience have been flat. Among high school graduate men however, experienced workers have adopted new technologies most intensively and the returns to experience have increased, pointing toward complementarities between existing skills and new technologies.