Introduction
In the last decade, there has been a paradigm shift in our thinking about the labor market impact of technological change. Up to 2010, the canonical model of the skill premium was most popular due to its simplicity and explanatory power. Today, task models of automation and the creation of new labor tasks are the dominant framework.
1. The canonical model
Acemoglu and Autor (2011) - Part 1
This section discusses the first part in Acemoglu and Autor (2011), “Skills, Tasks and Technologies: Implications for Employment and Earnings”, Handbook of Labor Economics, Sections 1-3, p. 1044-1117. The discussion summarizes the success of the canonical model in explaining the skill premium, but also its challenges that have lead to the emergence of task models.
- Paper
- Lecture video
- Lecture slides: pdf tex
2. Task-based models
Acemoglu and Restrepo (2019)
The paper discussed is Acemoglu and Restrepo (2019), “Automation and New Tasks: How Technology Displaces and Reinstates Labor”, Journal of Economic Perspectives. The discussion provides an introduction to task models assuming tasks are combined CES to produce aggregate output. The model presented predicts that automation decreases the labor share if the elasticity of substitution between capital and labor in aggregate output is not larger than unity. The discussion then tests this prediction using sectoral data and a decomposition of the aggregate labor share.
- Paper: main appendix
- Replication package
- Lecture video
- Lecture slides: pdf tex