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Working Paper

The impact of industrial robots on EU employment and wages: A local labour market approach

In theory, robots can directly displace workers from performing specific tasks (displacement effect). But they can also expand labour demand through the efficiencies they bring to industrial production (productivity effect). This working paper adopts the local labour market equilibrium approach developed by Acemoglu and Restrepo to assess which effects dominate and the impact of robots on wage growth and employment rate in Europe.

By: , and Date: April 18, 2018 Topic: Innovation & Competition Policy

The authors of this working paper study the impact of industrial robots on employment and wages in six European Union countries, which make up 85.5 percent of the EU industrial robots market.

In theory, robots can directly displace workers from performing specific tasks (displacement effect). But they can also expand labour demand through the efficiencies they bring to industrial production (productivity effect). The research adopts the local labour market equilibrium approach developed by Acemoglu and Restrepo (2017) to assess which of the two labour market effects dominates.

The authors find that one additional robot per thousand workers reduces the employment rate by 0.16-0.20 percentage points. Thus a significant displacement effect dominates. The displacement effect is particularly evident for workers of middle education and for young cohorts, while men are more affected than women. Estimates, however, do not point to robust and significant results on the impact of robots on wage growth, even after accounting for possible offsetting effects across different populations and sectoral groups.

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Policy Contribution

The productivity paradox: policy lessons from MICROPROD

The objective of MICROPROD, an EU-wide research project that runs until the end of 2021, is to understand what is driving the current productivity slowdown and what the potential consequences are for Europe's economic model and its citizens’ welfare. This Policy Contribution summarises the main, policy-relevant conclusions of the 20 MICROPROD papers delivered so far.

By: Grégory Claeys and Maria Demertzis Topic: European Macroeconomics & Governance, Innovation & Competition Policy Date: January 6, 2021
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Blog Post

COVID-19 has widened the income gap in Europe

Workers with low-educational levels suffered far worse than others in terms of COVID-19 related job losses during the first half of 2020 in the EU. Jobs for tertiary-educated workers even increased. Thus, the pandemic has increased income inequality, reinforcing the case for inclusive development.

By: Zsolt Darvas Topic: European Macroeconomics & Governance Date: December 3, 2020
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Blog Post

The scarring effect of COVID-19: youth unemployment in Europe

Even before the pandemic, youth unemployment in the European Union was three times higher than among the over-55s. COVID-19 threatens to undo the last decade of progress: policymakers must act to avoid Europe’s youth suffering the scarring effect.

By: Monika Grzegorczyk and Guntram B. Wolff Topic: European Macroeconomics & Governance Date: November 28, 2020
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External Publication

European Parliament

Data flows, artificial intelligence and international trade: impacts and prospects for the value chains of the future

In-depth briefing and analysis on the issues of digital trade and the geopolitics of trade provided to the European Parliament.

By: Dennis Görlich, Michèle Finck, Georgios Petropoulos, Niclas Poitiers and André Sapir Topic: European Macroeconomics & Governance, European Parliament Date: November 26, 2020
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Opinion

COVID-19 could leave another generation of young people on the scrapheap

It is time that the highest political level focuses on the risk of a lost generation.

By: Guntram B. Wolff Topic: European Macroeconomics & Governance Date: November 12, 2020
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Blog Post

L'IA a besoin d'humains qualifiés

L'adoption des technologies IA repose moins sur des scientifiques de haut niveau que sur des spécialistes des données et des programmeurs compétents qui peuvent mettre en pratique les algorithmes d'apprentissage profond existants à des fins commerciales.

By: Julia Anderson and Guntram B. Wolff Topic: European Macroeconomics & Governance, Innovation & Competition Policy Date: October 5, 2020
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Parliamentary Testimony

House of Lords

Employment and COVID-19

Testimony before the Economic Affairs Committee at the House of Lords, British Parliament on Employment and COVID-19.

By: Guntram B. Wolff Topic: European Macroeconomics & Governance, Finance & Financial Regulation, House of Lords, Testimonies Date: September 9, 2020
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Blog Post

Europe has an artificial-intelligence skills shortage

How severe is Europe’s dearth of AI talent and how does it compare to the United States, China and the United Kingdom – the world’s AI champions?

By: Julia Anderson, Paco Viry and Guntram B. Wolff Topic: European Macroeconomics & Governance, Innovation & Competition Policy Date: August 27, 2020
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Blog Post

Artificial intelligence’s great impact on low and middle-skilled jobs

Artificial intelligence and machine learning will significantly transform low-skilled jobs that have not yet been negatively affected by past technological change.

By: Sybrand Brekelmans and Georgios Petropoulos Topic: Innovation & Competition Policy Date: June 29, 2020
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Past Event

Past Event

The role of AI in healthcare

How can AI help us fight through a pandemic crisis?

Speakers: Dimitris Bertsimas, Georgios Petropoulos, Effy Vayena and Reinhilde Veugelers Topic: Innovation & Competition Policy Location: Bruegel, Rue de la Charité 33, 1210 Brussels Date: June 23, 2020
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Working Paper

Occupational change, artificial intelligence and the geography of EU labour markets

From 2002 up to 2009, the economies of European Union countries went through a skill upgrading, rather than a polarisation between low-skill and high-skill jobs. After 2009, this changed, with declining real wages and a significant increase in the share of workers in low-skill jobs. This assessment evaluates these changes in connection with labour market variables, population densities and the emergence of machine learning and artificial intelligence.

By: Sybrand Brekelmans and Georgios Petropoulos Topic: Innovation & Competition Policy Date: June 15, 2020
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Opinion

Reading tea leaves from China’s two sessions: Large monetary and fiscal stimulus and still no growth guarantee

The announcement of a large stimulus without a growth target indicates that China’s recovery is far from complete.

By: Alicia García-Herrero Topic: Global Economics & Governance Date: May 25, 2020
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