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Searching for robots

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  • Charalampidis, Nikolaos
  • Guillochon, Justine

Abstract

This paper relaxes the frequently adopted assumption of a frictionless market for robots in favor of a frictional market featuring firms that search for robot inventors with whom they match and bargain the robot price, and sheds light on its consequences in a structural model estimated for the US economy. A frictional robot market renders the diffusion of automation relatively rigid and persistent, with several implications. First, it relatively disconnects the labor market conditions from the robot market conditions and, thereby, weakens the labor displacement effect of automation and the automation threat. Second, it strengthens the present value of vacancies and, thereby, job creation and the volatility of labor market aggregates. Third, it renders aggregate productivity more sluggish. Under such a market, more than half of the fluctuations in the automation probability and the robot price stem from business-cycle forces.

Suggested Citation

  • Charalampidis, Nikolaos & Guillochon, Justine, 2025. "Searching for robots," Economic Modelling, Elsevier, vol. 152(C).
    • Handle: RePEc:eee:ecmode:v:152:y:2025:i:c:s026499932500255x
    DOI: 10.1016/j.econmod.2025.107260
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    JEL classification:

    • E24 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Employment; Unemployment; Wages; Intergenerational Income Distribution; Aggregate Human Capital; Aggregate Labor Productivity
    • E25 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Aggregate Factor Income Distribution
    • E32 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Business Fluctuations; Cycles
    • 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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