Melting Opportunities: Technological Change and Labor Market Perspectives

Abstract

Icemen were common in U.S. cities until refrigerators began to enter homes en masse. I study the long-run consequences of this technology shock for incumbent ice retailers and their descendants. I find that the general spread of electric refrigeration increased the likelihood of incumbents not only to leave ice retailing, but also to change occupations. These new occupations were often lower paid. Differentiating by fathers' self-employment status reveals that business owners adapted within the ice retailing industry, while dependent employees sought their fortunes outside of it. The technological shock had intergenerational spillover effects, particularly for younger cohorts of sons who faced a tradeoff between labor market participation and school attendance, leading to an average decline in school attendance rates.