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Aging, automation, and productivity in Korea1

Author

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  • Park, Cyn-Young
  • Shin, Kwanho
  • Kikkawa, Aiko

Abstract

This paper examines the impact of aging in the Republic of Korea on productivity as measured by labor productivity or total factor productivity (TFP). It also assesses the effect of robot adoption on the relation between aging and productivity using industrial level data. We find that aging is negatively associated with labor productivity and TFP growth. This is true particularly when aging is measured by increases in shares of old workers. If aging is measured by increases in the median age of workers, the negative effect is weaker. Evidence also suggests that robot technology mitigates aging's negative effect on productivity growth, particularly when productivity is measured by TFP. However, there is no evidence that robots are more heavily adopted in aged industries. While robot technology does not directly contribute to higher productivity growth, our findings suggest that the robot adoption can alleviate the negative impact of aging by helping workers in their 50s and 60s contribute less adversly to productivity growth.

Suggested Citation

  • Park, Cyn-Young & Shin, Kwanho & Kikkawa, Aiko, 2021. "Aging, automation, and productivity in Korea1," Journal of the Japanese and International Economies, Elsevier, vol. 59(C).
    • Handle: RePEc:eee:jjieco:v:59:y:2021:i:c:s0889158320300460
    DOI: 10.1016/j.jjie.2020.101109
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    References listed on IDEAS

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    Cited by:

    1. Park, Cyn-Young & Shin, Kwanho & Kikkawa, Aiko, 2022. "Demographic change, technological advance, and growth: A cross-country analysis," Economic Modelling, Elsevier, vol. 108(C).
    2. Yi-Chun Ko & Shinsuke Uchida & Akira Hibiki, 2024. "Substitution of Human and Physical Capitals in Farm Adaptation to Extreme Temperatures: Evidence from Corn Yields in US," TUPD Discussion Papers 49, Graduate School of Economics and Management, Tohoku University.
    3. Lee, Dongyeol, 2021. "Propagation of economic shocks through vertical and trade linkages in Korea: An empirical analysis," Japan and the World Economy, Elsevier, vol. 60(C).
    4. KO Yi-Chun & UCHIDA Shinsuke & HIBIKI Akira, 2024. "Aging Farmers and the Role of Community in Adaptation to Extreme Temperature Effects on Crop Yields," Discussion papers 24069, Research Institute of Economy, Trade and Industry (RIETI).

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    More about this item

    Keywords

    Aging; Automation; Robotics; Labor productivity; Total factor productivity; Growth;
    All these keywords.

    JEL classification:

    • J11 - Labor and Demographic Economics - - Demographic Economics - - - Demographic Trends, Macroeconomic Effects, and Forecasts
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • O33 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Technological Change: Choices and Consequences; Diffusion Processes
    • O47 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Empirical Studies of Economic Growth; Aggregate Productivity; Cross-Country Output Convergence

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