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Blueprint

Digitalisation and European welfare states

EU policymakers must find answers to pressing questions: if technology has a negative impact on labour income, how will the welfare state be funded? How can workers’ welfare rights be adequately secured? A team of Bruegel scholars, with the support of the Mastercard Center for Inclusive Growth, has taken on these questions.

By: , , and Date: July 9, 2019 Topic: Innovation & Competition Policy

Rapid technological progress and innovation can destroy jobs and disrupt welfare systems. This is not a new concern. Historically, automation of production processes has led to extraordinary efficiency gains and to the displacement of labour. But history has also shown that, in the longer run, the gains in efficiency pay off and new jobs are created.

But the past is not necessarily a guide to the future. Currently, an unprecedented digitalisation of our economy is underway. Artificial intelligence has become a reality and machines are able learn how to outperform humans in some cognitive tasks. The way work is performed is also changing, with jobs allocated via online platforms and people matched to tasks in a way that means they are neither full-time employees, nor self-employed workers in the traditional sense.

For welfare systems, which are largely funded by taxes on employment, these changes have significant implications. One of the big challenges of the twenty-first century will be to redefine the nature and functioning of welfare states in the context of the fundamental changes brought about by digitalisation, artificial intelligence and the changing status of workers. If technology has a negative impact on labour income, how will the welfare state be funded? How can workers’ welfare rights be secured?

This volumes tackles these questions and provides recommendations to inform the discussion in the European Union.

This report was produced with the financial support of the Mastercard Center for Inclusive Growth.

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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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Opinion

Regulation in the era of matchmaking economics

New approaches and new tools are needed to prevent excessive concentration of economic power in the hands of a few matchmaking digital platforms that form multi-sided markets. Regulation in this area is only just emerging.

By: Maria Demertzis Topic: European Macroeconomics & Governance Date: January 5, 2021
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Podcast

Podcast

The new EU digital regulations: Explained

Bruegel's experts walk you through all the details of the EU's Digital Services Act and Digital Markets Act.

By: The Sound of Economics Topic: Innovation & Competition Policy Date: December 16, 2020
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Past Event

Past Event

Europe and India: Comparing Approaches to Global Economic Challenges

Stakeholders from government, private sector, media and academia/institutions come together to review India-EU relations and point to a promising direction for the future.

Speakers: Yamini Aiyar, Suman Bery, Navroz K Dubash, Ignacio Garcia Bercero, Alicia García-Herrero, Rajat Kathuria, Gautam Mukhopadhaya, Ananth Padmanabhan, Georgios Petropoulos, André Sapir, Shyam Saran, Simone Tagliapietra and Guntram B. Wolff Topic: Global Economics & Governance Date: December 15, 2020
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Opinion

Brussels’ Digital Plan Leaves the Key Issue Unaddressed

To promote well-being and shared prosperity, EU decision-makers will need to show the same desire for competition beyond the boundaries of digital markets.

By: Mario Mariniello Topic: Innovation & Competition Policy Date: December 14, 2020
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Past Event

Past Event

Innovative approaches to monitoring the risks and impact of COVID-19

What new innovative tools can we use to measure real-time economic and social risk?

Speakers: Zsolt Darvas, Jaime Garcia, Ben McWilliams, Nicola Villa and Georg Zachmann Topic: Innovation & Competition Policy Location: Bruegel, Rue de la Charité 33, 1210 Brussels Date: December 8, 2020
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Opinion

A timid start for European Union data governance

Europe needs all pieces of its data strategy puzzle to be in place to enhance its competitive position: there is still a long way to go.

By: Mario Mariniello Topic: Innovation & Competition Policy Date: November 26, 2020
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Past Event

Past Event

Digital Platforms, Regulation and Competition: What's next for Europe?

Will the new rules of the internet go far enough for consumers and creators? Should we regulate platforms or will a code of conduct suffice?

Speakers: Diane Coyle, Jorge Padilla, Georgios Petropoulos and Alex A. Saliba Topic: Innovation & Competition Policy Location: Bruegel, Rue de la Charité 33, 1210 Brussels Date: November 26, 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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Past Event

Past Event

Free movement of data: how to maintain necessary sharing among the EU, UK, and USA?

In the current legal climate, how can the EU, the US and the UK continue to share data?

Speakers: Christian Borggreen, Joe Jones, Christian Kastrop, J. Scott Marcus and Reinhilde Veugelers Topic: Innovation & Competition Policy Location: Bruegel, Rue de la Charité 33, 1210 Brussels Date: November 25, 2020
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Past Event

Past Event

Future of data economy: a conversation with Thierry Breton and Maximilian Schrems

How will the data travel between the EU and the US in the aftermath of the Schrems II ruling?

Speakers: Thierry Breton, J. Scott Marcus and Maximilian Schrems Topic: Innovation & Competition Policy Location: Bruegel, Rue de la Charité 33, 1210 Brussels Date: November 24, 2020
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Working Paper

Digital platforms and antitrust

The market power of online platforms raises concerns that they may engage in anti-competitive practices, but traditional (ex-post) antitrust intervention will be less effective in markets driven by network effects unless it is combined with a proper (ex-ante) regulatory framework. Intervention should not reduce value creation, should focus on fair sharing of value, and should eliminate incentives for anti-competitive strategies.

By: Geoffrey Parker, Georgios Petropoulos and Marshall Van Alstyne Topic: Innovation & Competition Policy Date: November 23, 2020
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