Innlegg av Prof David Dorn på NHHs høstkonferanse 29oct
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Great Speech, great topic, big dilemma for diferent working groups in the US, and Norway.
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Innlegg av Prof David Dorn på NHHs høstkonferanse 29oct
- 1. Introduction Technology Trade Conclusions The Labor Market Effects of Technology and Trade Shocks in the United States Prof. Dr. David Dorn CEMFI Madrid October 2013 Dorn Technology and Trade
- 2. Introduction Technology Trade Conclusions Technology and Trade Key forces shaping labor markets in industrialized nations? Universal hypothesis: “Technology and Trade” Dorn Technology and Trade
- 3. Introduction Technology Trade Conclusions Outline 1 Technology Future: What are economists’ long-term predictions about technological change? Past: How did technology affect workers over the course of history? Present: What do we know about the labor market impacts of the ongoing “computer revolution”? 2 Trade How does its impact differ from that of technology? 3 Conclusions Dorn Technology and Trade
- 4. Introduction Technology Trade Conclusions Hypothesis 1: The End of Work? Dorn Technology and Trade
- 5. Introduction Technology Trade Conclusions Hypothesis 1: The End of Work? Source: Time Magazine Dorn Technology and Trade
- 6. Introduction Technology Trade Conclusions Hypothesis 2: The End of Technological Change? Dorn Technology and Trade
- 7. Introduction Technology Trade Conclusions Hypothesis 2: The End of Technological Change? Source: Gordon (2012) Dorn Technology and Trade
- 8. Introduction Technology Trade Conclusions Hypothesis 2: The End of Technological Change? Source: Gordon (2012) Dorn Technology and Trade
- 9. Introduction Technology Trade Conclusions A Clash of Predictions Speculative predictions about future technological change vary dramatically: 1 An ever accelerating improvement of computer technology will rapidly lead us to the point where computers dominate most human labor. 2 There is decreasing scope for future innovation, and technology will have little novel impact on labor markets in the future. Dorn Technology and Trade
- 10. Introduction Technology Trade Conclusions From Speculation to Evidence We can only speculate about the distant future. However, we have empirical evidence about past experience with technology: 1 What labor market effects of technology did people expect? 2 What were the actual impacts? I will discuss historical technological progress using examples from the textile sector. Dorn Technology and Trade
- 11. Introduction Technology Trade Conclusions Technology 1: Hand Spindle Source: Wikipedia Dorn Technology and Trade
- 12. Introduction Technology Trade Conclusions Technology 2: Spinning Wheel (11th-15th Century) Source: Wikipedia Dorn Technology and Trade
- 13. Introduction Technology Trade Conclusions Reaction to the Spinning Wheel: Bans In 1412, the city council of Cologne prohibited the production of a spinning wheel by a local craftsman, because it feared unemployment among textile manufacturers that used the hand spindle. In the 16th Century, the newly developed ribbon weaving machines were banned in large parts of Europe. Source: Prion (1907) Dorn Technology and Trade
- 14. Introduction Technology Trade Conclusions Technology 3: Spinning Machine (18th Century) Source: AP European History Dorn Technology and Trade
- 15. Introduction Technology Trade Conclusions Reaction to the Spinning Machine: Protests Source: Wikipedia Dorn Technology and Trade
- 16. Introduction Technology Trade Conclusions Labor Market Impact of Technological Innovation The spinning machine allowed that one worker produced the amount of yarn previously produced by 200 workers Nevertheless, technological progress did not induce a long-term rise in unemployment! Why? 1 Creation of new jobs in the “technology sector” (e.g., production of machines) 2 Falling price of textile allowed consumers to buy more textiles and other goods, thus creating job growth in many sectors of the economy Dorn Technology and Trade
- 17. Introduction Technology Trade Conclusions The Luddite Fallacy Predictions of technology-induced long-term unemployment have been proven wrong time and again. The amount and composition of work in the economy is not fixed: While there is ongoing mechanization of jobs, there is also ongoing creation of new employment opportunities. At the start of the 20th Century, few would have predicted that today, employment in banks or hospitals or in the entertainment industry exceeds employment of the entire agricultural sector. Dorn Technology and Trade
- 19. Introduction Technology Trade Conclusions What Do Computers Do? Computers execute routines that follow exact procedural rules: Saving/recalling/transmitting information Calculations Steering machines according to a pre-specified program Computers struggle with task that cannot easily be programed ex ante: Creativity Social interaction (leadership, negotiations, coaching) Visual and spatial recognition and fine motoric movement Dorn Technology and Trade
- 20. Introduction Technology Trade Conclusions “Routine” Occupations Compete with Computers Dorn Technology and Trade
- 21. Introduction Technology Trade Conclusions “Abstract” Occupations Benefit from Computers Dorn Technology and Trade
- 22. Introduction Technology Trade Conclusions “Manual” Occupations are not Directly Affected Dorn Technology and Trade
- 23. Introduction Technology Trade Conclusions “Routine” Occupations Have Middling Wages Source: Autor and Dorn (2013) Dorn Technology and Trade
- 24. Introduction Technology Trade Conclusions Labor Market Polarization: USA 1980-2005 Source: Autor and Dorn (2013) Dorn Technology and Trade
- 25. Introduction Technology Trade Conclusions Labor Market Polarization: Europe 1993-2006 Source: Goos, Manning and Salomons (2012) Dorn Technology and Trade
- 26. Introduction Technology Trade Conclusions Technology vs Trade Trade between wealthy countries and less developed countries has increased dramatically in the last 20-25 years. Most of this trade growth is driven by China’s rise as a global manufacturing superpower: Reforms since the 1980s: Special Economic Zones, better access to foreign investment and technology, facilitated domestic migration Result: dramatic increase in productivity in certain manufacturing industries US is potentially most affected by China because it provides few exports to China Dorn Technology and Trade
- 27. Introduction Technology Trade Conclusions US Trade with China Trade&Flows&Between&U.S.&and&&China& (Billions&of&2007&US&Dollars)& 1991& 2000& 2007& $400&bil& $350&bil& $330.0&bil& $300&bil& $250&bil& $200&bil& $150&bil& $121.6&bil& $100&bil& $57.4&bil& $50&bil& $26.3&bil& $10.3&bil& $23.0&bil& $0&bil& Imports& Exports& Source: Autor, Dorn and Hanson (2013) Dorn Technology and Trade
- 28. Introduction Technology Trade Conclusions Other Countries’ Trade with China Dorn Source: Autor, Dorn and Hanson (2013) Technology and Trade
- 29. Introduction Technology Trade Conclusions Measuring the Impacts of Trade and Technology Autor, Dorn and Hanson (2013) show that exposure to trade and technology differs across geographic locations in the US: Some cities are historically specialized in activities that use a lot of “routine” occupations, and now face greater exposure to computer technology Others are specialized in manufacturing industries that have become strongly exposed to import competition from China We study the impact of technology and trade exposure on employment in manufacturing and non-manufacturing jobs employment in “abstract” (e.g., managerial/professional), “routine” (e.g., clerical/production) and “manual” (e.g., service/construction) occupations Dorn Technology and Trade
- 30. Introduction Technology Trade Conclusions Geography of Technology Exposure Autor, Dorn and Hanson (2013) Dorn Technology and Trade
- 31. Introduction Technology Trade Conclusions Geography of Trade Exposure Autor, Dorn and Hanson (2013) Dorn Technology and Trade
- 32. Introduction Technology Trade Conclusions Trade and Technology Impacts in Manufacturing Source: Autor, Dorn and Hanson (2013) Dorn Technology and Trade
- 33. Introduction Technology Trade Conclusions Trade and Technology Impacts in Non-Manufacturing Source: Autor, Dorn and Hanson (2013) Dorn Technology and Trade
- 34. Introduction Technology Trade Conclusions What Do We Learn from the Evidence? 1 A long history shows that technological change (and increased trade) does not inevitably create long-term unemployment. 2 However, these forces affect the composition of employment: polarization of employment due to displacement of “routine” middle-wage occupations decline of manufacturing employment due to trade competition 3 Not all displaced workers can easily reallocate to new and attractive jobs. 4 A proactive school and training system should foster the competences that are least threatened by computerization and trade, such as creativity, problem solving, and communication. Dorn Technology and Trade