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Effects of advancing internet technology on Chinese employment: a spatial study of inter-industry spillovers

Huijuan Wang, Lin Ding, Rong Guan and Yan Xia

Technological Forecasting and Social Change, 2020, vol. 161, issue C

Abstract: The digital economy based on Internet technology has provided an important boost for economic growth. However, it has also created opportunities and challenges for stabilizing macroeconomic employment and growth. To measure how the Internet technology has influenced employment at the industry level in China, we first separate it from other technological progress in a production function model. Based on the input–output data spanning 2000–2014 in the World Input–Output Database (WIOD), we use a direct consumption coefficient matrix as the spatial weight matrices to verify inter-industry spillovers between 47 industries of China and its influence on employment by using spatial econometrics model. Empirical results indicate that Internet technology progress in one industry will significantly promote Internet technology progress in “adjacent” industries. Internet technology progress directly promote the employment within industry. Furthermore, due to the positive inter-industry spillovers, Internet technology progress also exerts positive effects on employment in other industries and positively affects employment within industry again through various feedback loops between industries. Therefore, policy should promote Internet technology in various industries, especially those closely linked to other industries, to stabilize employment and growth.

Keywords: Internet technology progress; Employment; Industry spillover effect; Spatial panel model (search for similar items in EconPapers)
Date: 2020
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DOI: 10.1016/j.techfore.2020.120259

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