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Hollowing out of opportunity: Automation technology and intergenerational mobility in the United States

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  • Guo, Ningning

Abstract

Recent automation technology has lead to job polarization in the U.S. labour market since 1980. Middle-skill jobs, which provide decent wages for relatively uneducated people, have been shrinking in terms of employment share, pushing those workers into low-wage service jobs. In this paper, by exploiting spatial variation in the exposure to technological substitution, I provide suggestive evidence that automation technology has contributed to the decline of upward mobility of children from poor and middle-class families. My analysis suggests that middle-skill jobs are an indispensable channel for disadvantaged children to move upward. In addition, this paper provides a plausible explanation for the puzzling observation that relative mobility has stayed constant in the U.S. during recent decades, despite the rapidly increasing income inequality.

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  • Guo, Ningning, 2022. "Hollowing out of opportunity: Automation technology and intergenerational mobility in the United States," Labour Economics, Elsevier, vol. 75(C).
    • Handle: RePEc:eee:labeco:v:75:y:2022:i:c:s092753712200029x
    DOI: 10.1016/j.labeco.2022.102136
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    3. Arntz, Melanie & Lipowski, Cäcilia & Neidhöfer, Guido & Zierahn, Ulrich, 2022. "Computers as stepping stones? Technological change and equality of labor market opportunities," ZEW Discussion Papers 22-014, ZEW - Leibniz Centre for European Economic Research.

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    More about this item

    Keywords

    Intergenerational mobility; Automation technology; Spatial disparity; Middle-skill jobs; Local labour market;
    All these keywords.

    JEL classification:

    • C13 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General - - - Estimation: General
    • C21 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Cross-Sectional Models; Spatial Models; Treatment Effect Models
    • D63 - Microeconomics - - Welfare Economics - - - Equity, Justice, Inequality, and Other Normative Criteria and Measurement
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • J62 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Job, Occupational and Intergenerational Mobility; Promotion
    • O33 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Technological Change: Choices and Consequences; Diffusion Processes

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