Adoption of Automation Technology and Labor Substitution (Japanese)

Daisuke Adachi, Shuhei Kainuma, Daiji Kawaguchi and Yukiko Saito

Policy Discussion Papers (Japanese) from Research Institute of Economy, Trade and Industry (RIETI)

Abstract: The threat of reductions in labor demand caused by automation in the manufacturing sector attracts much interest. However, it is pointed out that total labor demand should not decrease because automation in the manufacturing sector is associated with the new demand for labor associated with maintenance inspection services and the increase in productivity is expected to cause new demand for services. An increased demand scenario and decreased demand scenario resulting from automation are both theoretically possible, so further empirical investigation is necessary regarding the implications of both scenarios. Using the data on the number of industrial robots provided by the International Federation of Robotics and labor data from the Basic Survey of Employment Structure, this paper analyses the relationship between the adoption of industrial robots in the manufacturing sector and the number of employees at the regional labor market level following Acemogle and Restrepo (2018a). We found that there is no clear relationship between the adoption of industrial robots and the total amount of labor, and that there is a significant, positive relationship with labor for the manufacturing sector, implying no labor substitution.

Pages: 31 pages
Date: 2019-05
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Citations: View citations in EconPapers (4)

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Persistent link: https://EconPapers.repec.org/RePEc:eti:rpdpjp:19010

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