Technology and the Future of Work

Adrian Peralta and Agustin Roitman

No 2018/207, IMF Working Papers from International Monetary Fund

Abstract: This paper uses a DSGE model to simulate the impact of technological change on labor markets and income distribution. It finds that technological advances offers prospects for stronger productivity and growth, but brings risks of increased income polarization. This calls for inclusive policies tailored to country-specific circumstances and preferences, such as investment in human capital to facilitate retooling of low-skilled workers so that they can partake in the gains of technological change, and redistributive policies (such as differentiated income tax cuts) to help reallocate gains. Policies are also needed to facilitate the process of adjustment.

Keywords: Technology; labor markets; income distribution; income gain; increase in capital-labor substitutability; productivity gain; routine task intensity index; market income; office job; routine office job; middle-skilled workers; income polarization; price drop; drivers of labor income share; GDP gain; Income; Unskilled labor; Labor share; Labor force; Global (search for similar items in EconPapers)
Pages: 28
Date: 2018-09-28
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Citations: View citations in EconPapers (9)

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