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Re-Thinking the Capabilities of Machines in Economics

Author

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  • Daniel Susskind

Abstract

In the past 15 years a ‘task-based’ literature has emerged, exploring the consequences of technological change on the labour market. This literature relies on a particular understanding of the capabilities of machines – known as the ‘ALM hypothesis’. However, this hypothesis has often led the literature to underestimate these capabilities. Tasks that were believed to be out of reach of automation can now be automated. In this paper I set out two distinct explanations for why these capabilities were underestimated – one that is explored in the recent literature and maintains the ALM hypothesis, and a new explanation that challenges it. I propose a new hypothesis that nests the ALM hypothesis as a special case.

Suggested Citation

  • Daniel Susskind, 2017. "Re-Thinking the Capabilities of Machines in Economics," Economics Series Working Papers 825, University of Oxford, Department of Economics.
  • Handle: RePEc:oxf:wpaper:825
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    File URL: http://www.economics.ox.ac.uk/materials/papers/15127/825-susskind-capabilities-of-machines.pdf
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    References listed on IDEAS

    as
    1. David H. Autor, 2013. "The "Task Approach" to Labor Markets: An Overview," NBER Working Papers 18711, National Bureau of Economic Research, Inc.
    2. David H. Autor & Frank Levy & Richard J. Murnane, 2003. "The skill content of recent technological change: an empirical exploration," Proceedings, Federal Reserve Bank of San Francisco, issue Nov.
    3. David H. Autor, 2015. "Why Are There Still So Many Jobs? The History and Future of Workplace Automation," Journal of Economic Perspectives, American Economic Association, vol. 29(3), pages 3-30, Summer.
    4. repec:iab:iabjlr:v:46:i:3:p:185-199 is not listed on IDEAS
    5. Daron Acemoglu, 2002. "Technical Change, Inequality, and the Labor Market," Journal of Economic Literature, American Economic Association, vol. 40(1), pages 7-72, March.
    6. Daron Acemoglu & Pascual Restrepo, 2016. "The Race Between Machine and Man: Implications of Technology for Growth, Factor Shares and Employment," NBER Working Papers 22252, National Bureau of Economic Research, Inc.
    7. David Autor, 2014. "Polanyi's Paradox and the Shape of Employment Growth," NBER Working Papers 20485, National Bureau of Economic Research, Inc.
    Full references (including those not matched with items on IDEAS)

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    Cited by:

    1. Daniel Susskind, 2017. "A Model of Technological Unemployment," Economics Series Working Papers 819, University of Oxford, Department of Economics.

    More about this item

    Keywords

    Technological Change; Computerization; Automation; Job Tasks; Wages;

    JEL classification:

    • J20 - Labor and Demographic Economics - - Demand and Supply of Labor - - - General
    • J21 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Force and Employment, Size, and Structure
    • 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
    • J30 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - General
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials

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