How Powerful Are Trade Unions? A Skill-Biased Technological Change Approach

Neto, António; Afonso, Óscar; Silva, Sandra

doi:10.1017/s1365100516001346

Cited by 17 publications

(5 citation statements)

References 68 publications

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“…7): the late 1970s was a turning point for the American labor movement. It is also consistent with Neto et al (2019), who find that as the bargaining capacity of unions declines, industrial economies tend to experience greater wage dispersion. It also helps to explain the pattern observed by Afonso et al (2018), in which the United States, United Kingdom, and similar nations have experienced a combination of greater wage inequality and lower unemployment for unskilled labor.…”

Section: Do the Amt And Minimum Wage Maintain Real Parity?supporting

confidence: 88%

Economic inequality and congressional action in the United States: A comparison of the minimum wage and alternative minimum tax

Koger

Rodriguez

2021

Poverty & Public Policy

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A central puzzle in American politics is the stark increase in economic inequality since the early 1970s due, in part, to the absence of public policies to address this trend. One explanation is policy drift: Inequality has grown in the United States because the political process has been unresponsive to economic trends toward inequality. A second explanation is unequal political influence: Wealthy individuals and corporations wield superior political influence and tilt public policy toward their interests. We compare these explanations using the federal minimum wage and alternative minimum tax (AMT) from 1969 to 2012 as comparison cases. These policies were both denominated in nominal dollars, so the effect of policy inaction is comparable for both policy domains. We find that (1) the U.S. Congress was much more likely to update AMT policy than minimum wage policy after 1978, (2) Congress protected and increased the real value of the AMT deduction for married couples, whereas the real value of the minimum wage and individual deduction declined after 1978, (3) Congress and the President eventually converted the AMT-but not the minimum wageto automatic adjustments for inflation. These patterns highlight the role of political inequality in economic policy-making.

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Section: Do the Amt And Minimum Wage Maintain Real Parity?supporting

confidence: 88%

Economic inequality and congressional action in the United States: A comparison of the minimum wage and alternative minimum tax

Koger

Rodriguez

2021

Poverty & Public Policy

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“…Similarly, Esposito and Stehrer (2008) found that the SBTC can explain the shifts in labour that happened in Central and Eastern European countries during the transition from planned to market economy during the 1990s. Recent studies also identified similar trends in Germany (Hutter and Weber, 2017) as well as in Organisation for Economic Co-operation and Development (OECD) countries (Neto et al, 2019).…”

Section: Introductionmentioning

confidence: 61%

Upskilling, Deskilling or Polarisation? Evidence on Change in Skills in Europe

Martinaitis

Christenko²,

Antanavičius³

2020

Work, Employment and Society

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What are the directions of change in the complexity of work and the required skill levels of the labour force in Europe? Three prominent strands of literature suggest conflicting expectations – upskilling, deskilling and polarisation. This question is answered by employing a novel work complexity indicator that measures how tasks are performed at work according to three dimensions: routinisation of tasks, autonomy at work and continuous skill-building. The measurements rely on the European Working Conditions Surveys carried out in 2005, 2010 and 2015. The results show that the European labour markets witness upskilling with some polarisation, although there are significant cross-national differences. They also show that, individually, neither shifts in work complexity within occupations (deskilling hypothesis), nor changes in employment structure (the focus of the upskilling and polarisation hypotheses) can provide an adequate view of trends in the European labour markets. Instead, both vectors of change should be analysed collectively.

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“…Following Neto et al (2019), the representative infinitely lived household maximizes the discounted intertemporal lifetime utility, which depends positively on its consumption,

C

, and negatively on human labour, S =

L, H

, and robotic labour level,

R

, supplied, 12 and subject to the flow budget constraint and having perfect foresight concerning the technological‐knowledge progress overtime; thus, at time

t = 0

, the utility functions is

U goodbreak= \int_{0}^{\infty} ((), \frac{C {(t)}^{1 - θ} - 1}{1 - θ} goodbreak- \frac{S^{1 + η_{1}}}{1 + η_{1}} goodbreak- \frac{R^{1 + η_{2}}}{1 + η_{2}}) e^{- italicρt} italicdt,

whereby

U

is bounded away from infinity if the consumption of the output,

{[C (t)]}_{t \geq 0}

, is stable over time,

θ > 0

corresponds to the inverse of the inter‐temporal elasticity of substitution,

ρ > 0

is the subjective discount rate,

S

represents human labour, and

η_{1}

and

η_{2}

are the inverse of the Frisch elasticities of human‐labour supply and of robotic‐labour supply (i.e., there is utility from robotic work), respectively 13 . There is no doubt that a certain level of work is healthy, it is a source of creative expression and a path to self‐realization.…”

Section: Theoretical Setupmentioning

confidence: 99%

“…Following Neto et al (2019), the representative infinitely lived household maximizes the discounted intertemporal lifetime utility, which depends positively on its consumption, C, and negatively on human labour, S = L, H, and robotic labour level, R, supplied, 12 and subject to the flow budget constraint and having perfect foresight concerning the technological-knowledge progress overtime; thus, at time t ¼ 0, the utility functions is…”

Section: Preferences and Authoritiesmentioning

confidence: 99%

How powerful are fiscal and monetary policies in a directed technical change model with humans and robots?

Afonso

Forte

2021

Int. J Fin Econ

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We develop a dynamic general equilibrium model where robots can be substituted for unskilled labour and public authorities can use fiscal and monetary policies to influence the macroeconomic aggregates. We show that an increase in the use of robots increases the competitiveness of the unskilled sector and decreases the technological knowledge gap. However, under substitutability, unskilled workers are replaced by robots, and due to the magnitude of this effect the wage inequality increases. To mitigate this impact, public authorities can resort to fiscal and monetary policies. For instance, taxation on robots will induce the substitution of robots by unskilled labour, thus benefiting the unskilled labour—relative employment and wages.

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How Powerful Are Trade Unions? A Skill-Biased Technological Change Approach

Cited by 17 publications

References 68 publications

Economic inequality and congressional action in the United States: A comparison of the minimum wage and alternative minimum tax

Economic inequality and congressional action in the United States: A comparison of the minimum wage and alternative minimum tax

Upskilling, Deskilling or Polarisation? Evidence on Change in Skills in Europe

How powerful are fiscal and monetary policies in a directed technical change model with humans and robots?

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