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ICT-induced Technological Progress and Employment: a Happy Marriage or a Dangerous Liaison? A Literature Review

While the EU economy is struggling with the joint consequences of the 2008-2009 recession and the sovereign-debt crisis, the theoretical and policy debate largely revolves around the role ICT play in the structural dynamics of the labour markets. However, despite a wealth of theoretical speculation and empirical evidence, a consensus regarding the employment effect of ICT remains elusive. This report provides an overview of current perspectives on the employment impact of ICT. The main objective of this paper is to convey the need for a careful and open-minded assessment of the relation between employment and ICT. This assessment is needed in order to capture the full complexity of the factors influencing this relation, the transmission mechanisms involved, and the associated labour market effects. Our review devotes equal space to each mainstream economic theory on the complex connection between ICT and employment, while giving greater emphasis to those studies which provide empirical support to sound theoretical grounds.

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Paper provided by Directorate Growth & Innovation and JRC-Seville, Joint Research Centre in its series JRC Working Papers with number JRC76143.

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Length: 58 pages
Date of creation: Oct 2013
Date of revision:
Handle: RePEc:ipt:iptwpa:jrc76143
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