Robots, AI, and unemployment

Noritaka Kudoh and Hiroaki Miyamoto

Journal of Economic Dynamics and Control, 2025, vol. 174, issue C

Abstract: Do robots and artificial intelligence (AI) cause joblessness? We develop a dynamic general equilibrium model with search-matching frictions. In our model, robots substitute routine human tasks, and AI substitutes abstract human tasks. We find a cutoff level for the elasticity of substitution between routine labor input and robots, above which an increase in robot productivity leads to increased unemployment. We examine a scenario in which AI-driven automation of abstract tasks transforms high-skilled workers into unskilled ones. A substantial productivity gain through AI is required to offset the output loss associated with this labor displacement.

Keywords: Robots; Artificial intelligence; Capital-augmenting technological progress; Automation; Unemployment (search for similar items in EconPapers)
JEL-codes: E24 J20 J64 (search for similar items in EconPapers)
Date: 2025
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Persistent link: https://EconPapers.repec.org/RePEc:eee:dyncon:v:174:y:2025:i:c:s0165188925000351

DOI: 10.1016/j.jedc.2025.105069

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