IDEAS home Printed from https://ideas.repec.org/p/bav/wpaper/198_danzerfeuerbaumgaessler.html

Labor Supply and Automation Innovation

Author

Listed:
  • Alexander M. Danzer
  • Carsten Feuerbaum
  • Fabian Gaessler

Abstract

While economic theory suggests substitutability between labor and capital, little evidence exists regarding the causal effect of labor supply on inventing labor-saving technologies. We analyze the impact of exogenous changes in regional labor supply on automation innovation by exploiting an immigrant placement policy in Germany during the 1990s and 2000s. Difference-in-differences estimates indicate that one additional worker per 1,000 manual and unskilled workers reduces automation innovation by 0.05 patents. The effect is most pronounced two years after immigration and confined to industries containing many low-skilled workers. Labor market tightness and external demand are plausible mechanisms for the labor-innovation nexus.

Suggested Citation

  • Alexander M. Danzer & Carsten Feuerbaum & Fabian Gaessler, 2020. "Labor Supply and Automation Innovation," Working Papers 198, Bavarian Graduate Program in Economics (BGPE).
    • Handle: RePEc:bav:wpaper:198_danzerfeuerbaumgaessler
    as

    Download full text from publisher

    File URL: https://bgpe.cms.rrze.uni-erlangen.de/files/2023/07/198_Labor-Supply-and-Automation-Innovation.pdf
    File Function: First version, 2020
    Download Restriction: no
    ---><---

    Other versions of this item:

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Alexander M Danzer & Natalia Danzer & Carsten Feuerbaum, 2024. "Military spending and innovation: learning from 19th-century world fair exhibition data," Industrial and Corporate Change, Oxford University Press and the Associazione ICC, vol. 33(4), pages 831-854.
    2. Anna Gumpert & Kalina Manova & Cristina Rujan & Monika Schnitzer, 2025. "Multinational firms and global innovation," CEP Discussion Papers dp2083, Centre for Economic Performance, LSE.
    3. Andreas Lichter & Max Löffler & Ingo E. Isphording & Thu-Van Nguyen & Felix Poege & Sebastian Siegloch, 2025. "Profit Taxation, R&D Spending, and Innovation," American Economic Journal: Economic Policy, American Economic Association, vol. 17(1), pages 432-463, February.
    4. Rude, Britta & Giesing, Yvonne, 2022. "Technological Change and Immigration - A Race for Talent or of Displaced Workers," VfS Annual Conference 2022 (Basel): Big Data in Economics 264093, Verein für Socialpolitik / German Economic Association.
    5. Mann, Katja & Pozzoli, Dario, 2022. "Automation and Low-Skill Labor," IZA Discussion Papers 15791, Institute of Labor Economics (IZA).
    6. Yvonne Giesing, 2023. "The Impact of Technological Change on Immigration and Immigrants," CESifo Working Paper Series 10876, CESifo.
    7. Mann, Katja & Pozzoli, Dario, 2024. "Robots and immigration," Journal of Economic Behavior & Organization, Elsevier, vol. 227(C).

    More about this item

    Keywords

    ;
    ;
    ;
    ;
    ;
    ;

    JEL classification:

    • O31 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Innovation and Invention: Processes and Incentives
    • O33 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Technological Change: Choices and Consequences; Diffusion Processes
    • J61 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Geographic Labor Mobility; Immigrant Workers

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:bav:wpaper:198_danzerfeuerbaumgaessler. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Anton Barabasch (email available below). General contact details of provider: https://edirc.repec.org/data/vierlde.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.