Skill-biased technological change refers to the phenomenon where technological advancements favor skilled workers over unskilled ones, leading to an increase in demand for skilled labor while reducing demand for unskilled labor. This shift can contribute to rising income inequality as those with higher skill levels benefit more from technological progress, widening the wage gap between skilled and unskilled workers. Additionally, this change often leads to a transformation in the labor market, as job opportunities evolve and require different skill sets.
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