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Robots for economic development

Author

Listed:
  • Calì, Massimiliano
  • Presidente, Giorgio

Abstract

Recent evidence suggests that in manufacturing, automation technologies entail a trade-off between productivity gains and employment losses for the economies that adopt them. This paper casts doubts on such trade-off in the context of a developing country. It shows significant employment gains from automation in Indonesian manufacturing during the years 2008–2015, a period of rapid increase in robot imports. Analysis based on manufacturing plant data provides evidence that the absence of this trade-off is due to diminishing productivity returns to robot adoption. As a result, the benefits from automation could be particularly large for countries at early stages of industrialization.

Suggested Citation

  • Calì, Massimiliano & Presidente, Giorgio, 2025. "Robots for economic development," Labour Economics, Elsevier, vol. 96(C).
    • Handle: RePEc:eee:labeco:v:96:y:2025:i:c:s0927537125000557
    DOI: 10.1016/j.labeco.2025.102731
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    JEL classification:

    • O14 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Industrialization; Manufacturing and Service Industries; Choice of Technology
    • 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
    • L11 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Production, Pricing, and Market Structure; Size Distribution of Firms
    • F63 - International Economics - - Economic Impacts of Globalization - - - Economic Development

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