Job Polarization and Structural Change

Barany, Zsofia; Siegel, Christian

doi:10.1257/mac.20150258

Cited by 90 publications

(105 citation statements)

References 39 publications

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“…Indeed, recent evidence suggests that structural change as experienced in advanced economies since the 1950s seems to be characterized by a "hollowing-out" of the middle class, with negative consequences for income inequality and inclusiveness but potentially also for economic development more broadly (Bárány and Siegel, 2018).…”

Section: Automation and Productivity In Historical Perspectivementioning

confidence: 99%

Economics of Artificial Intelligence: Implications for the Future of Work

Ernst

Merola

Samaan

2019

IZA Journal of Labor Policy

195

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The current wave of technological change based on advancements in artificial intelligence (AI) has created widespread fear of job loss and further rises in inequality. This paper discusses the rationale for these fears, highlighting the specific nature of AI and comparing previous waves of automation and robotization with the current advancements made possible by a widespread adoption of AI. It argues that large opportunities in terms of increases in productivity can ensue, including for developing countries, given the vastly reduced costs of capital that some applications have demonstrated and the potential for productivity increases, especially among the low skilled. At the same time, risks in the form of further increases in inequality need to be addressed if the benefits from AI-based technological progress are to be broadly shared.For this, skills policies are necessary but not sufficient. In addition, new forms of regulating the digital economy are called for that prevent further rises in market concentration, ensure proper data protection and privacy, and help share the benefits of productivity growth through the combination of profit sharing, (digital) capital taxation, and a reduction in working time.The paper calls for a moderately optimistic outlook on the opportunities and risks from AI, provided that policymakers and social partners take the particular characteristics of these new technologies into account. which permits unrestricted use, distribution, and reproduction in any medium, provided you give appropriate credit to the original author(s) and the source, provide a link to the Creative Commons license, and indicate if changes were made.

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Section: Automation and Productivity In Historical Perspectivementioning

confidence: 99%

Economics of Artificial Intelligence: Implications for the Future of Work

Ernst

Merola

Samaan

2019

IZA Journal of Labor Policy

195

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“…12 See, e.g. Acemoglu and Autor (2011) and Bárány and Siegel (2017). 13 Alternatively, a more complex production system, with sectors M and I producing two distinct 8 There is a continuum of investors with unit mass.…”

Section: Workers and Investorsmentioning

confidence: 99%

Financial Intermediation, Capital Accumulation and Crisis Recovery

2019

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This paper integrates banks into a two-sector neoclassical growth model to account for the fact that a fraction of firms relies on banks to finance their investments. There are four major contributions to the literature: First, although banks' leverage amplifies shocks, the endogenous response of leverage to shocks is an automatic stabilizer that improves the resilience of the economy. In particular, financial and labor market institutions are essential factors that determine the strength of this automatic stabilization. Second, there is a mix of publicly financed bank re-capitalization, dividend payout restrictions, and consumption taxes that stimulates a Pareto-improving rapid build-up of bank equity and accelerates economic recovery after a slump in the banking sector. Third, the model replicates typical patterns of financing over the business cycle: procyclical bank leverage, procyclical bank lending, and countercyclical bond financing. Fourth, the framework preserves its analytical tractability wherefore it can serve as a macro-banking module that can be easily integrated into more complex economic environments. JEL: E21, E32, F44, G21, G28

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“…The role of FDI in ICT and R&D is, on the other hand, more difficult to interpret, as these investments seem to have a midgrading and downgrading effect, respectively. However, up to now, we have considered the employment shares to be independent from each other, and we have also omitted the relevance of sectoral structural changes [59] that we observed in Section 4.1.…”

Section: The Link Between High-and Low-skill Intensive Greenfield Fdimentioning

confidence: 99%

Inward Greenfield FDI and Patterns of Job Polarization

Amoroso

Moncada-Paternò-Castello

2018

Sustainability

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Abstract:The unprecedented growth in foreign direct investment in the last few decades has caused drastic changes in the labor markets of the host countries. The major part of FDI takes place in low-tech industries, where the wages and skills are low, or in high-tech, where they offer a wage premium for the highly skilled workers. This mechanism may increase the polarization of employment into high-wage and low-wage jobs, at the expense of middle-skill jobs. This paper looks at the effects of two types of FDI inflows, namely foreign investment in high-skill and low-skill activities, on job polarization. We match data on greenfield FDI aggregated by country and sector with data on employment by occupational skill to investigate the extent to which different types of greenfield FDI are responsible for skill polarization. Our results show that low-skill foreign investment shifts employment from high-to medium-and low-skill jobs, while skill-intensive FDI generally leads to skill upgrading. Only FDI in information and communication technology (ICT) is associated with job polarization, but only when accounting for the plurality of job polarization patterns across European sectors.

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Job Polarization and Structural Change

Cited by 90 publications

References 39 publications

Economics of Artificial Intelligence: Implications for the Future of Work

Economics of Artificial Intelligence: Implications for the Future of Work

Financial Intermediation, Capital Accumulation and Crisis Recovery

Inward Greenfield FDI and Patterns of Job Polarization

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