Should We Fear the Robot Revolution? (The Correct Answer is Yes)

Author/Editor:

Andrew Berg ; Edward F Buffie ; Luis-Felipe Zanna

Publication Date:

May 21, 2018

Electronic Access:

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Disclaimer: IMF Working Papers describe research in progress by the author(s) and are published to elicit comments and to encourage debate. The views expressed in IMF Working Papers are those of the author(s) and do not necessarily represent the views of the IMF, its Executive Board, or IMF management.

Summary:

We may be on the cusp of a “second industrial revolution” based on advances in artificial intelligence and robotics. We analyze the implications for inequality and output, using a model with two assumptions: “robot” capital is distinct from traditional capital in its degree of substitutability with human labor; and only capitalists and skilled workers save. We analyze a range of variants that reflect widely different views of how automation may transform the labor market. Our main results are surprisingly robust: automation is good for growth and bad for equality; in the benchmark model real wages fall in the short run and eventually rise, but “eventually” can easily take generations.

Series:

Working Paper No. 18/116

Subject:

English

Publication Date:

May 21, 2018

ISBN/ISSN:

9781484300831/1018-5941

Stock No:

WPIEA2018116

Price:

$18.00 (Academic Rate:$18.00)

Format:

Paper

Pages:

61

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