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Job Creation and Destruction in the Digital Age: What about Portugal?

Author

Listed:
  • Anabela M. Santos

    (Comissão Europeia)

  • Javier Barbero Jimenez

    (Comissão Europeia Author-3-Name: Simone Salotti
    Comissão Europeia)

  • Andrea Conte

    (Comissão Europeia)

Abstract

We assess the effect of digitalisation on employment for the European Union countries, and Portugal in particular, using data for the 1995-2019 period. We estimate an augmented labour demand function derived from a Constant Elasticity of Substitution (CES) cost function to test for a capital-labour substitution effect, distinguishing between digital and traditional capital. The results point towards a positive impact of digital investments on total employment, but the effects are heterogeneous depending on the different employment categories. In particular, high-skilled jobs benefit from digitalisation at the expense of medium- and low-skilled ones. Results for Portugal also show evidence of an overall positive effect of digital investments on employment, showing that an increase of €100.000 in the stock of digital technologies is associated with an increase of 4.6 jobs.

Suggested Citation

  • Anabela M. Santos & Javier Barbero Jimenez & Andrea Conte, 2022. "Job Creation and Destruction in the Digital Age: What about Portugal?," GEE Papers 0163, Gabinete de Estratégia e Estudos, Ministério da Economia, revised Jun 2022.
    • Handle: RePEc:mde:wpaper:0163
    as

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    File URL: https://www.gee.gov.pt//RePEc/WorkingPapers/GEE_PAPERS_163.pdf
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    References listed on IDEAS

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    More about this item

    Keywords

    Digitalisation; Employment; Skills; Europe; Portugal;
    All these keywords.

    JEL classification:

    • O33 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Technological Change: Choices and Consequences; Diffusion Processes
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • O52 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Europe

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