Fragile robots, economic growth and convergence

Torben Klarl

Economic Modelling, 2022, vol. 112, issue C

Abstract: Technological progress leads to the development of robots that are more error-prone and fragile than their predecessors. Consequently, utilizing the existing automation capital stock is associated with higher wear and tear, CPU overload, communication downtime, and, ultimately, increased depreciation costs. This, in turn, affects new future investments. Considering a growth model with physical and automation capital utilization, we argue that utilized automation capital, not the automation capital stock, is a perfect substitute for labor in a fully automated society. We show that it is not necessarily the introduction of capital utilization alone, but rather the relationship between the elasticities of the utilization of automation and physical capital that slows the convergence speed in a model that reflects an automated society.

Keywords: Automation; Capital utilization; Perpetual economic growth (search for similar items in EconPapers)
JEL-codes: O40 (search for similar items in EconPapers)
Date: 2022
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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Working Paper: Fragile Robots, Economic Growth and Convergence (2022)
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Persistent link: https://EconPapers.repec.org/RePEc:eee:ecmode:v:112:y:2022:i:c:s0264999322000967

DOI: 10.1016/j.econmod.2022.105850

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