Using 1994–95 survey data on customer service representatives in 303 U.S. bank branches, the authors investigate the effects on wages of information technology (IT), of work practices, and of those two factors in combination. Offline high-involvement practices (measured by the presence of quality circles) were related positively to wages, as was more extensive use of IT that supports sales efforts. Where IT was used more extensively to automate routine processes, wages were lower in branches that did not have high-involvement work practices. The effects are partially explained by higher education requirements and more extensive introductory training in higher-wage jobs.
Get full access to this article
View all access options for this article.
References
1.
AdlerPaul. 1986. “New Technologies, New Skills.”California Management Review, Vol. 29, No. 1 (Fall), pp. 9–28.
2.
AdlerPaul. 1992. “Introduction.” In AdlerPaul S., ed., Technology and the Future of Work. New York: Oxford University Press, pp. 1–14.
3.
AdlerPaul, and BorysBryan. 1995. “A Portrait of the Relationship between Mechanization and Work in the U.S. Economy.”International Journal of Human Factors in Manufacturing, Vol. 5, No. 4, pp. 345–75.
4.
AkerlofGeorge A., and YellenJanet L.. 1986. Efficiency Wage Models of the Labor Market. Cambridge: Cambridge University Press.
5.
AppelbaumEileenBaileyThomasBergPeter, and KallebergArne L.. 2000. Manufacturing Advantage: Why High-Performance Work Systems Pay Off. Ithaca, N.Y.: ILR Press (an imprint of Cornell University Press).
6.
AppelbaumEileen, and BattRosemary. 1994. The New American Workplace: Transforming Work Systems in the United States. Ithaca, N.Y.: ILR Press (an imprint of Cornell University Press).
7.
AttewellPaul. 1987. “The Deskilling Controversy.”Work and Occupations, Vol. 14, No. 3 (August), pp. 323–46.
8.
AttewellPaul. 1990. “What Is Skill?”Work and Occupations, Vol. 17, No. 4 (November), pp. 422–48.
9.
AttewellPaul, and RuleJames. 1984. “Computing and Organizations: What We know and What We Don't Know.”Communications of the ACM, Vol. 27, No. 12, pp. 1184–92.
10.
AutorDavid H.1995. “Estimating the Effects of Computerization on Wages, Educational Shares, and the Employment of Secretaries and Managers, 1984–1993: A Panel Approach.” Working paper, Harvard University.
11.
AutorDavid H.KatzLawrence F., and KruegerAlan B.. 1998. “Computing Inequality: Have Computers Changed the Labor Market?”Quarterly Journal of Economics, Vol. 113, No. 4 (November), pp. 1169–1213.
12.
AutorDavid H.LevyFrank, and MurnaneRichard J.. 2002. “Upstairs, Downstairs: Computers and Skills on Two Floors of a Large Bank.”Industrial and Labor Relations Review, Vol. 55, No. 3 (April 2002), pp. 432–47.
13.
BarleyStephen R.1986. “Technology as an Occasion for Structuring: Evidence from Observations of CT Scanners and the Social Order of Radiology Departments.”Administrative Science Quarterly, Vol. 31, No. 1 (March), pp. 78–108.
14.
BattRosemary. 2001. “Explaining Wage Inequality in Telecommunications Services: Customer Segmentation, Human Resource Practices, and Union Decline.”Industrial and Labor Relations Review, Vol. 54, No. 2A (special issue, March), pp. 425–49.
15.
BergerAllen N.KashyapA. K., and ScaliseJoseph M.. 1995. “The Transformation of the U.S. Banking Industry: What a Long, Strange Trip It's Been.”Brookings Papers on Economic Activity, Vol. 2, pp. 55–218.
16.
BoundJohn. 1996. “Discussion of ‘Technology and Skill Requirements.’”New England Economic Review, pp. 154–56.
17.
BoundJohn, and JohnsonGeorge. 1995. “What Are the Causes of Rising Wage Inequality in the United States?”Economic Policy Review (published by the Federal Reserve Bank of New York), Vol. l, pp. 9–17.
18.
BravermanHarry. 1974. Labor and Monopoly Capital. New York: Monthly Review Press.
19.
BresnahanTimothyBrynjolfssonErik, and HittLorin M.. 2000. “Technology, Organization, and the Demand for Skilled Labor.” In BlairMargaret M. and KochanThomas A., eds., The New Relationship: Human Capital in the American Corporation. Washington, D.C.: Brookings Institution Press, Chap. 5, pp. 145–93.
20.
BrownCharles, and MedoffJames. 1989. “The Employer Size-Wage Effect.”Journal of Political Economy, Vol. 97, No. 5 (February), pp. 1027–59.
21.
CappelliPeter. 1993. “Are Skill Requirements Rising? Evidence from Production and Clerical Jobs.”Industrial and Labor Relations Review, Vol. 46, No. 3 (April), pp. 515–30.
22.
CappelliPeter. 1996. “Technology and Skill Requirements: Implications for Establishment Wage Structures.”New England Economic Review, May-June, pp. 139–54.
23.
CappelliPeter, and CarterWilliam. 2000. “Work Organization, Computer Use, and Wage Outcomes.” NBER Working Paper No. 9287.
24.
DiNardoJohn E., and PischkeJorn-Steffen. 1997. “The Returns to Computer Use Revisited: Have Pencils Changed the Wage Structure Too?”Quarterly Journal of Economics, Vol. 112, No. 1 (February), pp. 291–303.
25.
DomsMarkDunneTimothy, and TroskeKenneth. 1997. “Workers, Wages, and Technology.”Quarterly Journal of Economics, Vol. 112, No. 1 (February), pp. 253–90.
26.
DunneTimothy, and SchmitzJames. 1995. “Wages, Employment Structure, and Employer-Size Wage Premia: Their Relationship to Advanced-Technology Usage at U.S. Manufacturing Establishments.”Economica, Vol. 62, No. 245, pp. 89–107.
27.
FreemanRichard. 1997. When Earnings Diverge: Causes, Consequences, and Cures for the New Inequality in the U.S.Commissioned by the Committee on New American Realities of the National Policy Association. Washington, D.C.
28.
GlennEvelyn Nakano, and FeldbergRoslyn L.. 1977. “Degraded and Deskilled: The Proletarianization of Clerical Work.”Social Problems, Vol. 25, pp. 52–64.
29.
GoldinClaudia, and KatzLawrence F.. 1996. “Technology, Skill, and the Wage Structure: Insights from the Past.”American Economic Review, Vol. 86, No. 2 (May), pp. 252–57.
30.
HirschhornLarry. 1984. Beyond Mechanization: Work and Technology in a Postindustrial Age. Cambridge, Mass.: MIT Press.
31.
HuberGeorge P., and PowerDaniel J.. 1985. “Retrospective Reports of Strategic-level Managers: Guidelines for Increasing Their Accuracy.”Strategic Management Journal, Vol. 6, No. 2, pp. 171–80.
32.
HunterLarry W.1999. “Transforming Retail Banking: Inclusion and Segmentation in Service Work.” In CappelliPeter, ed., Employment Practices and Business Strategy. New York: Oxford University Press, pp. 153–92.
33.
HunterLarry W.. 2000. “What Determines Job Quality in Nursing Homes?”Industrial and Labor Relations Review, Vol. 53, No. 3 (April), pp. 463–81.
34.
HunterLarry W.BernhardtAnnetteHughesKatherine L., and SkuratowiczEva. 2001. “It's Not Just the ATMs: Technology, Firm Strategies, Jobs, and Earnings in Retail Banking.”Industrial and Labor Relations Review, Vol. 54, No. 2A (special issue, March), pp. 402–24.
35.
JaccardJamesTurrisiRobert, and WanChoi K.. 1990. Interaction Effects in Multiple Regression. Newbury Park, Calif.: Sage.
36.
JudgeGeorge G.1985. The Theory and Practice of Econometrics, 2nd ed.New York: Wiley.
37.
KelleyMaryellen. 1990. “New Process Technology, Job Design, and Work Organization: A Contingency Model.”American Sociological Review, Vol. 55 (April), pp. 191–208.
38.
KeltnerBrent, and FinegoldDavid. 1996. “Adding Value in Banking: Human Resource Innovations for Service Firms.”Sloan Management Review, Vol. 38, No. 3 (Fall), pp. 57–68.
39.
KruegerAlan. 1993. “How Computers Have Changed the Wage Structure: Evidence from Microdata, 1984–1989.”Quarterly Journal of Economics, Vol. 109, No. 1 (February), pp. 35–78.
40.
LazearEdward P.1995. “A Jobs-Based Analysis of Labor Markets.”American Economic Review, Vol. 85, No. 2 (May), pp. 260–65.
41.
LeidnerRobin. 1993. Fast Food, Fast Talk: Service Work and the Routinization of Everyday Life. Berkeley: University of California Press.
42.
MacDuffieJohn Paul. 1991. “Beyond Mass Production: Flexible Production Systems and Manufacturing Performance in the World Auto Industry.” Diss., Sloan School of Management, M.I.T.
43.
MacDuffieJohn Paul. 1995. “Human Resource Bundles and Manufacturing Performance: Organizational Logic and Flexible Production Systems in the World Auto Industry.”Industrial and Labor Relations Review, Vol. 48, No. 2 (January), pp. 197–221.
44.
NobleDavid F.1984. Forces of Production: A Social History of Industrial Automation. New York: Knopf.
45.
OstermanPaul. 1994. “How Common Is Workplace Transformation and Who Adopts It?”Industrial and Labor Relations Review, Vol. 47, No. 2 (January), pp. 173–88.
46.
OstermanPaul. 2000. “Work Reorganization in an Era of Restructuring: Trends in Diffusion and Effects on Employee Welfare.”Industrial and Labor Relations Review, Vol. 53, No. 2 (January), pp. 179–96.
47.
PodsakoffPhilip M., and OrganDennis W.. 1986. “Self-Reports in Organizational Research: Problems and Prospects.”Journal of Management, Vol. 12, No. 4 (July), pp. 531–44.
48.
RamseyJames B.1969. “Tests for Specification Errors in Classical Linear Least Squares Regression Analysis.”Journal of the Royal Statistical Society, Series B 31, pp. 350–71.
49.
RebitzerJames B.1986. “Establishment Size and Job Tenure.”Industrial Relations, Vol. 25, No. 3 (Fall), pp. 292–302.
50.
ReginiMarinoKitayJim, and BaethgeMartin, eds. 1999. From Tellers to Sellers: Changing Employment Relations in Banks. Cambridge, Mass.: MIT Press.
51.
RogersW. H.1993. “Regression Standard Errors in Clustered Samples.”Stata Technical Bulletin, Vol. 13, pp. 19–23.
52.
RuleJames, and AttewellPaul. 1989. “What Do Computers Do?”Social Problems, Vol. 36, No. 3, pp. 225–41.
53.
SpennerKenneth. 1990. “Skill: Meanings, Methods, and Measures.”Work and Occupations, Vol. 17, No. 4 (November), pp. 399–421.
54.
VallasSteven Peter. 1990. “The Concept of Skill: A Critical Review.”Work and Occupations, Vol. 17, No. 4 (November), pp. 379–98.
55.
ZuboffShoshana. 1988. In the Age of the Smart Machine: The Future of Work and Power. New York: Basic Books.
