On the possibility of automation-induced stagnation
Emanuel Gasteiger and
Klaus Prettner
No 07-2017, Hohenheim Discussion Papers in Business, Economics and Social Sciences from University of Hohenheim, Faculty of Business, Economics and Social Sciences
Abstract:
We analyze the long-run growth effects of automation in the standard overlap- ping generations framework. We show that, in contrast to other neoclassical models of capital accumulation, automation does not promote growth but induces economic stagnation. The reason is that automation suppresses wages, which are the only source of investment in the overlapping generations framework.
Keywords: automation; robots; investment; stagnation; economic growth; overlapping generations model (search for similar items in EconPapers)
JEL-codes: J10 J20 O14 O33 O41 (search for similar items in EconPapers)
Date: 2017
New Economics Papers: this item is included in nep-dge, nep-fdg, nep-gro and nep-pay
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Citations: View citations in EconPapers (3)
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Persistent link: https://EconPapers.repec.org/RePEc:zbw:hohdps:072017
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