Exploring policy responses to labour-saving technologies: An assessment of basic income, job guarantee, and working time reduction

D’Alessandro, Simone, Tiziano Distefano, Guilherme Spinato Morlin and Davide Villani

Journal of Policy Modeling, 2025, vol. 47, issue 1, 49-63

Abstract: This study examines policy responses to labor-saving technologies, focusing on employment and income inequality. Using the EUROGREEN model, we assess three scenarios: basic income, job guarantee, and working time reduction. The job guarantee scheme effectively reduces unemployment but raises the fiscal deficit, while working time reduction improves wage share, cuts deficits, and reduces inequality. Basic income has a moderate impact on unemployment but significantly reduces inequality but is accompanied by higher deficits. A wealth tax could help finance these policies and contribute to inequality reduction. This research provides novel insights to policymakers by demonstrating how a strategic mix of labour policies can improve socio-economic outcomes in the face of technological-induced job disruptions.

Keywords: Labour-saving technologies; Input-output; Inequality; Policy scenario analysis; Automation (search for similar items in EconPapers)
JEL-codes: E61 F47 Q57 (search for similar items in EconPapers)
Date: 2025
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Persistent link: https://EconPapers.repec.org/RePEc:eee:jpolmo:v:47:y:2025:i:1:p:49-63

DOI: 10.1016/j.jpolmod.2025.01.001

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