Robots and AI: A New Economic Era PDF
Preview Robots and AI: A New Economic Era
i Robots and AI Robots and artificial intelligence (AI) are powerful forces that will likely have large impacts on the size, direction, and composition of international trade flows. This book discusses how industrial robots, automation, and AI affect international growth, trade, productivity, employment, wages, and welfare. The book explains new approaches on how robots and artificial intelligence affect the world economy by presenting detailed theoretical framework and country-specific as well as firm-product level-specific exercises. This book will be a useful reference for those researching on robots, automation, AI and their economic impacts on trade, industry, and employment. Lili Yan Ing is Lead Advisor (Southeast Asia Region) at the Economic Research Institute for ASEAN and East Asia (ERIA). Dr Ing was appointed as Lead Advisor to the Minister of Trade of the Republic of Indonesia in 2017–2019. Gene M. Grossman is the Jacob Viner Professor of International Economics in the Department of Economics and the School of Public and International Affairs at Princeton University. Routledge-ERIA Studies in Development Economics World Trade Evolution: Growth, Productivity, and Employment Edited by Lili Yan Ing and Miaojie Yu East Asian Integration Goods, Services and Investment Edited by Lili Yan Ing, Martin Richardson and Shujiro Urata Developing the Digital Economy in ASEAN Edited by Lurong Chen and Fukunari Kimura Globalisation and its Economic Consequences Looking at APEC Economies Edited by Shujiro Urata and Ha Thi Thanh Doan Intellectual Property Rights and ASEAN Development in the Digital Age Edited by Lurong Chen and Fukunari Kimura COVID-19 in Indonesia Impacts on the Economy and Ways to Recovery Edited by Lili Yan Ing and M. Chatib Basri The Indonesian Economy: Trade and Industrial Policies Edited by Lili Yan Ing, Gordon H. Hanson, and Sri Mulyani For more information about this series, please visit: www.routledge.com/ Routledge-ERIA-Studies-in-Development-Economics/book-series/ERIA iii Robots and AI A New Economic Era Edited by Lili Yan Ing and Gene M. Grossman First published 2023 by Routledge 4 Park Square, Milton Park, Abingdon, Oxon OX14 4RN and by Routledge 605 Third Avenue, New York, NY 10158 Routledge is an imprint of the Taylor & Francis Group, an informa business © 2023 selection and editorial matter, Economic Research Institute for ASEAN and East Asia (ERIA); individual chapters, the contributors The right of Economic Research Institute for ASEAN and East Asia (ERIA) to be identified as the author of the editorial material, and of the authors for their individual chapters, has been asserted in accordance with sections 77 and 78 of the Copyright, Designs and Patents Act 1988. The Open Access version of this book, available at www.taylorfrancis. com, has been made available under a Creative Commons Attribution- Non Commercial-No Derivatives 4.0 license. No part of this book may be reprinted or reproduced or utilised in any form or by any electronic, mechanical, or other means, now known or hereafter invented, including photocopying and recording, or in any information storage or retrieval system, without permission in writing from the publishers. Trademark notice: Product or corporate names may be trademarks or registered trademarks, and are used only for identification and explanation without intent to infringe. British Library Cataloguing-in-Publication Data A catalogue record for this book is available from the British Library Library of Congress Cataloging-in-Publication Data A catalog record for this book has been requested ISBN: 978-1-032-23066-5 (hbk) ISBN: 978-1-032-23067-2 (pbk) ISBN: 978-1-003-27553-4 (ebk) DOI: 10.4324/9781003275534 Typeset in Galliard by Apex CoVantage, LLC v – – While most if not all jobs can be replaced by robots and AI, love cannot be. To Lee Jae Hun LYI To Jean Baldwin Grossman GMG vii Contents List of figures ix List of tables xi List of contributors xv Acknowledgements xvii 1 Introduction 1 LILI YAN ING AND GENE M. GROSSMAN 2 The Effects of Automation on Labor Demand: A Survey of the Recent Literature 15 PHILIPPE AGHION, CÉLINE ANTONIN, SIMON BUNEL, AND XAVIER JARAVEL 3 Robots, Offshoring, and Welfare 40 ALESSANDRA BONFIGLIOLI, ROSARIO CRINÒ, GINO GANCIA, AND IOANNIS PAPADAKIS 4 On the Employment Consequences of Automation and Offshoring: A Labor Market Sorting View 82 ESTER FAIA, SÉBASTIEN LAFFITTE, MAXIMILIAN MAYER, AND GIANMARCO OTTAVIANO 5 The Impacts of AI, Robots, and Globalization on Labor Markets: Analysis of a Quantitative General Equilibrium Trade Model 123 TAIJI FURUSAWA, SHOKI KUSAKA, AND YOICHI SUGITA 6 Telemigration and Development: On the Offshorability of Teleworkable Jobs 150 RICHARD BALDWIN AND JONATHAN I. DINGEL 7 Immigration and Regional Specialization in AI 180 GORDON HANSON viii Contents viii 8 Robots and Trade: Implications for Developing Countries 232 ERHAN ARTUC, PAULO BASTOS, ALEXANDER COPESTAKE, AND BOB RIJKERS 9 Automation in Indonesia: Productivity, Quality, and Employment 275 LILI YAN ING AND RUI ZHANG 10 AI, Trade, and Creative Destruction: A First Look 310 RUIQI SUN AND DANIEL TREFLER Index 346 ix Figures 2.1 Firm-Level Event Study of Automation on Hourly Wage Ratio between Low- and High-Skilled Workers 32 2.2 Firm-Level Event Study of Automation on Employment in the Automotive Industry 34 2.3 Effect of a Substantial Investment in Industrial Equipment on Probability of Firm Exit 34 3.1 Employment-to-Population Ratio by Sector 54 3.2 Employment-to-Population Ratio by Occupation Group 56 3.3 Robot Imports and Offshoring over Time 57 3.4 Robot Imports and Offshoring by Sector 58 3.5 Robot Exposure and Offshoring across Commuting Zones 59 3.B1 Robot Exposure and Employment: Alternative Corrections of Standard Errors 81 4.1 The Impact of Routineness and Offshorability on Labour Hours 93 4.2 Employment Concentration 102 4.3 Unemployment Duration 103 4.4 Mismatch 103 4.5 Employment 104 4.6 Relative Wages of Best vs. Worst Match 104 4.A1 Correlation between Automation Probability and Routineness 113 4.A2 Automation Probability and Offshorability (BK, 09) 114 5.1 World Trade in Goods, Capital, and Robots 124 5.2 Robot Exports and Imports Across Countries in 2018 124 5.3 Estimated and Actual Robot Prices 133 6.1 Blinder’s Classification Procedure 152 6.2 Importance of English Language for Teleworkable versus Non-teleworkable Jobs 155 6.3 Importance of Oral and Written Expression for Teleworkable versus Non-teleworkable Jobs 156 6.4 Importance of Persuasion and Social Perceptiveness for Teleworkable versus Non-teleworkable Jobs 157
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