This paper examines the implications of skill-biased technological change (SBTC) for relative wages and employment in the OECD. The authors argue that SBTC, rather than increased trade with developing countries, is the main cause of the decline in relative wages and employment of less skilled workers in the US and other developed countries. SBTC is pervasive across the OECD, occurring simultaneously in most, if not all, developed countries. This pervasiveness is important because it allows for testing and provides a clear implication for relative wages. The authors find strong evidence supporting SBTC, including within-industry shifts toward skilled labor despite rising or stable relative wages and concentrated skill demand in the same manufacturing industries across different developed countries. They also find that the spread of microprocessor technology is associated with significant technological changes in industries such as electrical machinery, machinery (including computers), and printing and publishing. The authors also consider evidence from the developing world, finding that increased relative wages of skilled labor in some LDCs is consistent with SBTC. The paper concludes that SBTC is a plausible explanation for the increased demand for skilled labor in the developed world and that its effects are consistent with both increased wage premiums for skilled workers and within-industry substitution toward skilled workers. The authors also note that SBTC can affect relative wages even in small open economies, as its occurrence in many countries allows for analysis of integrated equilibrium as if the OECD were a closed economy. The paper provides evidence that SBTC is pervasive across the OECD and that it is a key factor in the increased demand for skilled labor in the developed world.This paper examines the implications of skill-biased technological change (SBTC) for relative wages and employment in the OECD. The authors argue that SBTC, rather than increased trade with developing countries, is the main cause of the decline in relative wages and employment of less skilled workers in the US and other developed countries. SBTC is pervasive across the OECD, occurring simultaneously in most, if not all, developed countries. This pervasiveness is important because it allows for testing and provides a clear implication for relative wages. The authors find strong evidence supporting SBTC, including within-industry shifts toward skilled labor despite rising or stable relative wages and concentrated skill demand in the same manufacturing industries across different developed countries. They also find that the spread of microprocessor technology is associated with significant technological changes in industries such as electrical machinery, machinery (including computers), and printing and publishing. The authors also consider evidence from the developing world, finding that increased relative wages of skilled labor in some LDCs is consistent with SBTC. The paper concludes that SBTC is a plausible explanation for the increased demand for skilled labor in the developed world and that its effects are consistent with both increased wage premiums for skilled workers and within-industry substitution toward skilled workers. The authors also note that SBTC can affect relative wages even in small open economies, as its occurrence in many countries allows for analysis of integrated equilibrium as if the OECD were a closed economy. The paper provides evidence that SBTC is pervasive across the OECD and that it is a key factor in the increased demand for skilled labor in the developed world.