Should we fear the robot revolution? (The correct answer is yes)

Berg, Andrew; Buffie, Edward F.; Zanna, Luis-Felipe

doi:10.1016/j.jmoneco.2018.05.014

Cited by 186 publications

(88 citation statements)

References 31 publications

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“…3 Indeed, while a fall in the labor share is ruled out by design in most canonical macroeconomic models (e.g., Ngai and Pissarides 2007), recent literature revisits this assumption, offering models where labor displacement is one potential outcome. For example, Sachs and Kotlikoff (2012) and Berg et al (2017) write down an overlapping-generation models in which rapid labor-saving technological advances generate short-run gains for skilled workers and capital owners, but in the longer run, immiserate those who are not able to invest in physical or human capital. Acemoglu and Restrepo (forthcoming and 2018b) consider models in which two countervailing economic forces determine the evolution of labor's share of income: the march of technological progress, which gradually replaces 'old' tasks, reducing labor's share of output and possibly diminishing real wages; and endogenous technological progress that generates novel labor-demanding tasks, potentially reinstating labor's share.…”

Section: Introductionmentioning

confidence: 99%

Is Automation Labor-Displacing? Productivity Growth, Employment, and the Labor Share

Autor¹,

Salomons²

2018

197

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Is automation a labor-displacing force? This possibility is both an age-old concern and at the heart of a new theoretical literature considering how labor immiseration may result from a wave of 'brilliant machines,' which is in part motivated by declining labor shares in many developed countries. Comprehensive evidence on this labor-displacing channel is at present limited. Using the recent model of Acemoglu and Restrepo (2018b) as an analytical frame, we first outline the various channels through which automation impacts labor´s share of output. We then turn to empirically estimating the employment and labor share impacts of productivity growth-an omnibus measure of technological change-using data on 28 industries for 18 OECD countries since 1970. Our main findings are that although automation-whether measured by Total Factor Productivity growth or instrumented by foreign patent flows or robot adoption-has not been employment-displacing, it has reduced labor's share in value-added. We disentangle the channels through which these impacts occur, including: own-industry effects, cross-industry input-output linkages, and final demand effects accruing through the contribution of each industry's productivity growth to aggregate incomes. Our estimates indicate that the labor share-displacing effects of productivity growth, which were essentially absent in the 1970s, have become more pronounced over time, and are most substantial in the 2000s. This finding is consistent with automation having become in recent decades less labor-augmenting and more labor-displacing.

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Section: Introductionmentioning

confidence: 99%

Is Automation Labor-Displacing? Productivity Growth, Employment, and the Labor Share

Autor¹,

Salomons²

2018

197

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“…15 Adding an explicit capital deepening effect as a result of automation in the long run as in Acemoglu and Restrepo (2018b) could further offset the negative effect of lower labour supply growth. Berg et al (2018), employing a neoclassical growth model with robots, argue automation leads to higher growth and inequality. Technology in their model is exogenous thus the innovation and automation trade-off is not present.…”

Section: Proofmentioning

confidence: 99%

From secular stagnation to robocalypse? Implications of demographic and technological changes

Basso

Jimeno

2021

Journal of Monetary Economics

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The Working Paper Series seeks to disseminate original research in economics and fi nance. All papers have been anonymously refereed. By publishing these papers, the Banco de España aims to contribute to economic analysis and, in particular, to knowledge of the Spanish economy and its international environment. The opinions and analyses in the Working Paper Series are the responsibility of the authors and, therefore, do not necessarily coincide with those of the Banco de España or the Eurosystem. The Banco de España disseminates its main reports and most of its publications via the Internet at the following website: http://www.bde.es. Reproduction for educational and non-commercial purposes is permitted provided that the source is acknowledged.

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“…Indeed, even modest changes in the degree of complementarity can produce vast differences in labor market outcomes (Berg et al, 2018a;IMF, 2018). To the extent that AI is expected to replace mental tasks as explained above, it is, however, not entirely obvious that AI-based innovations might be characterized by strong capital-skill complementarities.…”

Section: Capital-skill Complementaritymentioning

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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Should we fear the robot revolution? (The correct answer is yes)

Cited by 186 publications

References 31 publications

Is Automation Labor-Displacing? Productivity Growth, Employment, and the Labor Share

Is Automation Labor-Displacing? Productivity Growth, Employment, and the Labor Share

From secular stagnation to robocalypse? Implications of demographic and technological changes

Economics of Artificial Intelligence: Implications for the Future of Work

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