Working Paper

Robots, Tools, and Jobs: Evidence from Brazilian Labor Markets

Abstract: What is the effect of robots and tools on employment and inequality? Using natural language processing and an instrumental variable approach, we discover that robots have led to a sizable decrease in the employment and wages of low-skill workers in operational occupations. However, tools — machines that complement labor — have led to an equally large reinstatement of these workers, increasing their employment and wages. Using a quantitative model, we find that the lower prices of robots and tools over the last 20 years have reduced inequality and increased welfare without a significant effect on employment.

Keywords: robots; Automation; tools; Labor-augmenting;

JEL Classification: J23; J24;

Bibliographic Information

Provider: Federal Reserve Bank of Chicago

Part of Series: Working Paper Series

Publication Date: 2023-11-30

Number: WP 2023-42