Does Automation Technology increase Wage?

Ryosuke Shimizu () and Shohei Momoda ()
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Ryosuke Shimizu: Aoyama Gakuin University
Shohei Momoda: Kyoto University

No 1039, KIER Working Papers from Kyoto University, Institute of Economic Research

Abstract: This paper examines the relationship between automation technology diffusion and the wage. In this model, producers either choose automation or nonautomation technology, whichever is more profitable. When they introduce the automation technology, they have to pay fixed costs, which are different between industries. The main results of this paper are that the productivity improvement of automation technology, which promotes automation diffusion, decreases labor share, and this improvement also decreases the wage when the level of automation technology diffusion is high enough.

Keywords: automation; the wage; labor share decline; technology choice (search for similar items in EconPapers)
JEL-codes: E24 J23 O3 (search for similar items in EconPapers)
Pages: 55pages
Date: 2020-08
New Economics Papers: this item is included in nep-lma and nep-mac
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