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What Are the Labor and Product Market Effects of Automation? New Evidence from France

Author

Listed:
  • Philippe Aghion

    (Harvard University)

  • Céline Antonin

    (OFCE - Observatoire français des conjonctures économiques (Sciences Po) - Sciences Po - Sciences Po)

  • Simon Bunel
  • Xavier Jaravel

    (LSE - London School of Economics and Political Science)

Abstract

What are the effects of automation in the labor and product markets? A host of factors may be at play. Automating the production process may displace certain workers, raising the possibility of technological unemployment, but these displacement effects could be offset by a productivity effect. Automation may induce productivity gains, increase market demand and the scale of production, and in turn increase labor demand. Depending on the extent to which productivity gains are passed through to consumers by producers, consumers could benefit from lower prices or producers could retain higher profits. Finally, because of business-stealing effects from firms that automate and displace their competitors, the industry-level employment and the price and profit effects of automation may differ from their firm-level or plant-level impacts. [First paragraph]

Suggested Citation

  • Philippe Aghion & Céline Antonin & Simon Bunel & Xavier Jaravel, 2020. "What Are the Labor and Product Market Effects of Automation? New Evidence from France," SciencePo Working papers Main hal-03384668, HAL.
    • Handle: RePEc:hal:spmain:hal-03384668
    Note: View the original document on HAL open archive server: https://hal.science/hal-03384668
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    References listed on IDEAS

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    More about this item

    Keywords

    Automation; Employment; Plant-level; Firm-level; Labor market; Product market; Manufacturing;
    All these keywords.

    JEL classification:

    • 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
    • O3 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights

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