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Racing With or Against the Machine? Evidence on the Role of Trade in Europe

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  • Terry Gregory
  • Anna Salomons
  • Ulrich Zierahn

Abstract

Digital technologies displace labor from routine tasks, raising concerns that labor is racing against the machine. We develop an empirically tractable task-based framework to estimate the aggregate employment effects of routine-replacing technological change (RRTC), along with the labor and product demand channels through which this aggregate effect comes about, focusing on the role of inter-regional trade. While RRTC has indeed had strong displacement effects in Europe between 1999 and 2010, it has simultaneously created new jobs through increased product demand, resulting in net employment growth. However, the distribution of gains from technological progress matters for its job-creating potential.

Suggested Citation

  • Terry Gregory & Anna Salomons & Ulrich Zierahn, 2022. "Racing With or Against the Machine? Evidence on the Role of Trade in Europe," Journal of the European Economic Association, European Economic Association, vol. 20(2), pages 869-906.
    • Handle: RePEc:oup:jeurec:v:20:y:2022:i:2:p:869-906.
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    File URL: http://hdl.handle.net/10.1093/jeea/jvab040
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    Citations

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    Cited by:

    1. Prettner, Klaus, 2023. "Stagnant wages in the face of rising labor productivity: The potential role of industrial robots," Finance Research Letters, Elsevier, vol. 58(PD).
    2. Fierro, Luca Eduardo & Caiani, Alessandro & Russo, Alberto, 2022. "Automation, Job Polarisation, and Structural Change," Journal of Economic Behavior & Organization, Elsevier, vol. 200(C), pages 499-535.
    3. Bustos, Emil, 2023. "The Effect of Centrally Bargained Wages on Firm Growth," Working Paper Series 1456, Research Institute of Industrial Economics.
    4. Abeliansky, Ana Lucia & Prettner, Klaus, 2023. "Automation and population growth: Theory and cross-country evidence," Journal of Economic Behavior & Organization, Elsevier, vol. 208(C), pages 345-358.
    5. Jacobs, Arthur, 2023. "Capital-augmenting technical change in the context of untapped automation opportunities," Mathematical Social Sciences, Elsevier, vol. 123(C), pages 155-166.
    6. Diego Dabed Sitnisky & Sabrina Genz & Emilie Rademakers, 2023. "Resilience to Automation: The Role of Task Overlap for Job Finding," Working Papers 2312, Utrecht School of Economics.
    7. Yoon, Chungeun, 2023. "Technology adoption and jobs: The effects of self-service kiosks in restaurants on labor outcomes," Technology in Society, Elsevier, vol. 74(C).
    8. Gravina, Antonio Francesco & Pappalardo, Maria Rosaria, 2022. "Are robots in rich countries a threat for employment in emerging economies?," Economics Letters, Elsevier, vol. 221(C).
    9. Arntz, Melanie & Blesse, Sebastian & Doerrenberg, Philipp, 2022. "The end of work is near, isn't it? Survey evidence on automation angst," ZEW Discussion Papers 22-036, ZEW - Leibniz Centre for European Economic Research.

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