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The Impact of Digital Technologies on Worker Tasks: Do Labor Policies Matter?

Author

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  • Almeida, Rita K.

    (World Bank)

  • Corseuil, Carlos Henrique

    (Institute for Applied Economic Research (IPEA), Brazil)

  • Poole, Jennifer P.

    (American University)

Abstract

Between 1999 and 2006, Brazilian cities experienced strong growth in the provision of internet services, driven in part by the privatization of the telecommunications industry. A main concern of policymakers is that digital technology replaces routine, manual tasks, displacing lower-skilled workers. In Brazil, stringent labor market institutions exist to protect workers from such shocks, but by increasing labor costs, labor policy may also constrain firms from adjusting the workforce and fully benefiting from technology adoption. We show that digital technology adoption shifted the demand for skills toward an increased use of non-routine and cognitive tasks. Furthermore, and in contrast with labor policy intentions, we show that de facto labor market regulations differentially benefit the most skilled workers, particularly those workers employed in non-routine and cognitive tasks. Our results point to important changes in the future of labor markets in middle-income settings and warn for distortive and unintended consequences of labor market policies.

Suggested Citation

  • Almeida, Rita K. & Corseuil, Carlos Henrique & Poole, Jennifer P., 2017. "The Impact of Digital Technologies on Worker Tasks: Do Labor Policies Matter?," IZA Discussion Papers 11151, Institute of Labor Economics (IZA).
  • Handle: RePEc:iza:izadps:dp11151
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    Cited by:

    1. Rita K. Almeida & Ana M. Fernandes & Mariana Viollaz, 2017. "Does the Adoption of Complex Software Impact Employment Composition and the Skill Content of Occupations? Evidence from Chilean Firms," CEDLAS, Working Papers 0214, CEDLAS, Universidad Nacional de La Plata.
    2. Stemmler, Henry, 2019. "Does automation lead to de-industrialization in emerging economies? Evidence from Brazil," University of Göttingen Working Papers in Economics 382, University of Goettingen, Department of Economics.
    3. Bennett, Fidel & Escudero, Veronica & Liepmann, Hannah & Podjanin, Ana, 2022. "Using Online Vacancy and Job Applicants' Data to Study Skills Dynamics," IZA Discussion Papers 15506, Institute of Labor Economics (IZA).

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    More about this item

    Keywords

    labor regulations; skills; digital technology;
    All these keywords.

    JEL classification:

    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • J48 - Labor and Demographic Economics - - Particular Labor Markets - - - Particular Labor Markets; Public Policy
    • O3 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights
    • O15 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Economic Development: Human Resources; Human Development; Income Distribution; Migration

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