Automation and Structural Transformation in Developing Countries

Abstract

Technological change is likely to create a dual economy of automation-resistant and automation-susceptible sectors. Correspondingly, the labor force employed in automatable domains is pushed toward new activities-a dynamic that we liken to the classical Lewis model. We argue that the role of artificial intelligence and other advances is likely to be what we term a "robot reserve army," providing infinite supplies of artificial labor particularly in the agricultural and manufacturing sector. From this emerges a new pattern of structural transformation, as outlined in the previous chapter, with new distributional implications. We argue that tertiarization, income inequality, and wage stagnation, rather than, technological unemployment, are the key challenges of late development in the age of automation.Developing countries have special characteristics (vis-à-vis OECD countries): they tend to be labor-abundant and have higher rates of population growth than OECD countries. Large proportions of the population are often relatively unskilled and tertiary education is still comparatively CHAPTER 5

Viewpoint: The future of work in agri-food

“…They dramatically reduce transaction costs in input and output markets, change economies of scale, and modify the optimal capital/labor mix in agricultural production, processing, and marketing. Because some agricultural tasks are arguably more automatable (more routine and less cognitive) than those in industry and services ( Schlogl and Sumner, 2020 ), automation could accelerate the exit of labor out of agriculture in developing countries and transform farms and food processing firms in the developed world. A future with robots in the fields and packing plants, together with technology-savvy farmworkers to complement new technological solutions in specific commodities and tasks, already is taking shape.…”

Human resource development 4.0 (HRD 4.0) in the apparel industry of Bangladesh: a theoretical framework and future research directions

“…The fourth Industrial Revolution, an internet-enabled technology, has significantly revolutionized industrial processes (Chitturu et al, 2017;Bessen et al, 2018). Pertinently, the fourth industrial revolution (4IR) extends an opportunity to lessen the digital barriers and harness all potential benefits across the globe (Schlogl and Sumner, 2020); however, the involvement of human resources continues to be an indispensable part (Kucera and Barcia de Mattos, 2019). 4IR refers to the technological transformations based on the cyber-physical systems (CPS), which are integrated into varied technologies not limited to big data, robots, simulation, artificial intelligence (AI), system integration, Internet of things (IoT), cybersecurity, cloud computing, smart manufacturing and augmented reality (Chaka, 2020).…”

“…Despite some positive economic impacts, automation has a huge displacing effect in developing countries with almost no evidence (Cal ı and Presidente, 2021). The millions of low-paid workers in developing countries have become vulnerable to automation and technology-induced unemployment, which is the key challenge at the development age of digitalization (Frey and Osborne, 2017;Jain and Yuan, 2020;Kerlin et al, 2020;Schlogl and Sumner, 2020). In fact, several researchers have forecasted the massive job loss in the apparels industry due to the implementation of 4IR, while the competitive advantages of cheap labor are expected to be IJM 43,2 weakened in developing countries in the coming days (Popli et al, 2017;Parschau and Hauge, 2020;Shibin et al, 2020).…”