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Minimum Wages and Rise of the Robots

Author

Listed:
  • Erik Brynjolfsson
  • J. Frank Li
  • Javier Miranda
  • Robert Seamans
  • Andrew J. Wang

Abstract

This paper studies how minimum wage policy affects firms’ adoption of automation technologies. Using both state-level measures of robot exposure and novel plant-level data on industrial robot imports linked to U.S. Census microdata from 1992–2021, we show that increases in minimum wages raise the likelihood of robot adoption in manufacturing. Our preferred identification exploits discontinuities at state borders, comparing otherwise similar firms exposed to different wage floors. Across specifications, a 10 percent increase in the minimum wage increases robot adoption by roughly 8 percent relative to the mean.

Suggested Citation

  • Erik Brynjolfsson & J. Frank Li & Javier Miranda & Robert Seamans & Andrew J. Wang, 2026. "Minimum Wages and Rise of the Robots," NBER Working Papers 34895, National Bureau of Economic Research, Inc.
    • Handle: RePEc:nbr:nberwo:34895
    Note: LS PR
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    More about this item

    JEL classification:

    • J38 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Public Policy
    • O33 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Technological Change: Choices and Consequences; Diffusion Processes

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