Away from Home and Back: Coordinating (Remote) Workers in 1800 and 2020

Abstract

We examine the future of remote work by drawing parallels between two contexts: The move from home to factory-based production during the Industrial Revolution and the shift to work from home today. In both cases, new technology induced new working arrangements, and this shift was associated with a similar trade-off in the past as it is today: productivity advantages and cost savings versus organizational barriers such as coordinating workers under the new workplace arrangement. Using contemporary data, we show that the COVID-19 pandemic moved even sectors with high organizational barriers to working from home. Without further technological or organizational innovations, this shift is likely to be reversed, and remote work may not be here to stay just yet.

JEL Classification: F63, O14