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Multinationals, Robots, and the Labor Share

Fabrizio Leone

No 2022-17, Working Papers ECARES from ULB -- Universite Libre de Bruxelles

Abstract: Using a panel of Spanish manufacturing firms covering the 1990-2017 period, I show that firms acquired by multinational enterprises start investing in industrial robots, which leads to a reduction of the labor share at the firm and industry levels. The results are explained by a model of robot adoption and are robust to accounting for selection into multinational ownership. The estimates imply that, without multinationals and robots, the manufacturing labor share would be at its level of two decades ago. These findings shed new light on how globalization and technological change jointly shape the decline in the labor share.

Keywords: Foreign Ownership; Industrial Robots; Total Factor Productivity; Factor-Biased Productivity; Labor Share (search for similar items in EconPapers)
Pages: 73 p.
Date: 2022-05
New Economics Papers: this item is included in nep-ene, nep-int, nep-lma and nep-tid
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