Pandemics and Automation: Will the Lost Jobs Come Back?

27 Pages Posted: 9 Mar 2021

See all articles by Tahsin Saadi-Sedik

Tahsin Saadi-Sedik

International Monetary Fund (IMF)

Jiae Yoo

International Monetary Fund (IMF)

Date Written: January 1, 2021

Abstract

COVID-19 has exacerbated concerns about the rise of the robots and other automation technologies. This paper analyzes empirically the impact of past major pandemics on robot adoption and inequality. First, we find that pandemic events accelerate robot adoption, especially when the health impact is severe and is associated with a significant economic downturn. Second, while robots may raise productivity, they could also increase inequality by displacing low-skilled workers. We find that following a pandemic, the increase in inequality over the medium term is larger for economies with higher robot density and where new robot adoption has increased more. Our results suggest that the concerns about the rise of the robots amid the COVID-19 pandemic seem justified.

JEL Classification: D63, E24, J23, J31, J63, J64, M51, O33, I12, E25

Suggested Citation

Saadi-Sedik, Tahsin and Yoo, Jiae, Pandemics and Automation: Will the Lost Jobs Come Back? (January 1, 2021). IMF Working Paper No. 2021/011, Available at SSRN: https://ssrn.com/abstract=3799603

Tahsin Saadi-Sedik (Contact Author)

International Monetary Fund (IMF) ( email )

700 19th Street N.W.
Washington, DC 20431
United States

Jiae Yoo

International Monetary Fund (IMF) ( email )

700 19th Street, N.W.
Washington, DC 20431
United States

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