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The impact of robots in Latin America: Evidence from local labor markets

Author

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  • Brambilla, Irene
  • César, Andrés
  • Falcone, Guillermo
  • Gasparini, Leonardo

Abstract

We study the effect of robots on labor markets in Argentina, Brazil, and Mexico, the major robot users in Latin America, during the period 2004–2016. We exploit spatial and time variations in exposure to robots arising from initial differences in industry specialization across geographic locations and the evolution of robot adoption across industries, to estimate a causal effect of robots on local labor market outcomes. We find that district’s exposure to robots causes a relative deterioration in labor market indicators such us unemployment and labor informality. We document that robots mainly replace formal salaried jobs, affecting young and semi-skilled workers to a greater extent, and that informal employment acts as a buffer that prevents a larger increase in unemployment.

Suggested Citation

  • Brambilla, Irene & César, Andrés & Falcone, Guillermo & Gasparini, Leonardo, 2023. "The impact of robots in Latin America: Evidence from local labor markets," World Development, Elsevier, vol. 170(C).
    • Handle: RePEc:eee:wdevel:v:170:y:2023:i:c:s0305750x2300089x
    DOI: 10.1016/j.worlddev.2023.106271
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    More about this item

    Keywords

    Robot adoption; Local labor markets; Latin America; Unemployment; Informality;
    All these keywords.

    JEL classification:

    • J23 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Demand
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
    • J46 - Labor and Demographic Economics - - Particular Labor Markets - - - Informal Labor Market
    • O14 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Industrialization; Manufacturing and Service Industries; Choice of Technology
    • O17 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Formal and Informal Sectors; Shadow Economy; Institutional Arrangements
    • R10 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - General

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