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Discussion Paper
Women Have Been Hit Hard by the Loss of Routine Jobs, Too
Technological change and globalization have caused a massive transformation in the U.S. economy. While creating new opportunities for many workers, these forces have eliminated millions of good-paying jobs, particularly routine jobs in the manufacturing sector. Indeed, a great deal of attention has focused on the consequences of the loss of blue-collar production jobs for prime‑age men. What is often overlooked, however, is that women have also been hit hard by the loss of routine jobs, particularly administrative support jobs—a type of routine work that has historically been largely ...
Working Paper
Adjusting to Robots: Worker-Level Evidence
We estimate the effect of industrial robots on employment, wages, and the composition of jobs in German labor markets between 1994 and 2014. We find that the adoption of industrial robots had no effect on total employment in local labor markets specializing in industries with high robot usage. Robot adoption led to job losses in manufacturing that were offset by gains in the business service sector. We analyze the impact on individual workers and find that robot adoption has not increased the risk of displacement for incumbent manufacturing workers. They stay with their original employer, and ...
Working Paper
Occupation Mobility, Human Capital and the Aggregate Consequences of Task-Biased Innovations
We construct a dynamic general equilibrium model with occupation mobility, human capital accumulation and endogenous assignment of workers to tasks to quantitatively assess the aggregate impact of automation and other task-biased technological innovations. We extend recent quantitative general equilibrium Roy models to a setting with dynamic occupational choices and human capital accumulation. We provide a set of conditions for the problem of workers to be written in recursive form and provide a sharp characterization for the optimal mobility of individual workers and for the aggregate supply ...
Working Paper
Can Pandemic-Induced Job Uncertainty Stimulate Automation?
The COVID-19 pandemic has raised concerns about the future of work. The pandemic may become recurrent, necessitating repeated adoptions of social distancing measures (voluntary or mandatory), creating substantial uncertainty about worker productivity. But robots are not susceptible to the virus. Thus, pandemic-induced job uncertainty may boost the incentive for automation. However, elevated uncertainty also reduces aggregate demand and reduces the value of new investment in automation. We assess the importance of automation in driving business cycle dynamics following an increase in job ...
Working Paper
Digital Adoption, Automation, and Labor Markets in Developing and Emerging Economies
We document a strong negative link between self-employment and the rate of digital adoption by firms in developing and emerging economies. No link between digital adoption and the unemployment rate is found, however. To explain this evidence, we build a general equilibrium search-and-matching model with endogenous labor force participation, self-employment, endogenous firm entry, and information-and-communications technology adoption. The main finding is that changes in the cost of technology adoption per se cannot rationalize the evidence. Instead, changes in firms' barriers to entry ...
Discussion Paper
Automation and the Future of Work
There are numerous reports that highlight potential effects that new technology will have on the U.S. labor market, and many of them are not exactly what you would expect. For example, with the advent of the internet and ubiquity of spreadsheets in the 1980s, analyst employment soared. The new technology unlocked latent demand for more analysis that had been simply too expensive before the new communication and productivity technologies became common. The need for more analysis led to more analysts…even though there were new technologies that made the work more efficient or productive.
Speech
Hanging a Question Mark
Fed?s Harker Speaks at Management Science?s 65th Anniversary Conference. Philadelphia Fed President Patrick T. Harker gave remarks focusing on technology, automation, and the importance of human insight at Management Science?s 65th Anniversary Conference in Boston. ?In my experience, you run into trouble when you start thinking your model can do all the work,? he said.
Journal Article
Workers' Shrinking Share of the Pie
Features: {{p}} Economists have advanced a wide variety of explanations for why workers' share of overall income has been going down
Journal Article
The Resurgence of Universal Basic Income
Concerns about the effects of automation have brought an old policy proposal back into the limelight
Discussion Paper
“Forced Automation” by COVID-19? Early Trends from Current Population Survey Data
This empirical study evaluates whether COVID-19 and the threat of future pandemics has expedited the process of automation in the U.S. The results suggest that the pandemic displaced more workers in automatable occupations, putting them at a greater risk of being permanently automated. The automatable jobs that are more vulnerable to the pandemic include jobs that do not permit remote work, have a high risk of COVID-19 transmission, or are in the most affected sectors. While most of the job losses during the pandemic are expected to be temporary, a replication of the analysis for the Great ...