Mechanization, Task Assignment, and Inequality
41 Pages Posted: 7 Jan 2014 Last revised: 17 May 2021
Date Written: May 2021
Abstract
Mechanization (or automation) has proceeded continuously since the Industrial Revolution and seems to have accelerated recently due to the rapid advancement of information technology. This paper theoretically examines long-run trends of mechanization, shifts of tasks humans perform, and earnings levels and inequality. Specifically, the paper develops a Ricardian model of task assignment and analyzes how improvements of productivities of machines and an increase in the relative supply of skilled workers affect task assignment (which factor performs which task), earnings levels and inequality, and aggregate output. The model succeeds in capturing the great majority of the long-run trends. The paper also explores possible future trends of the variables when information technology continues to grow rapidly.
Keywords: mechanization, automation, task assignment, earnings inequality, information technology
JEL Classification: J24, J31, N30, O14, O33
Suggested Citation: Suggested Citation