Labor supply and automation innovation: Evidence from an allocation policy
Alexander M. Danzer, Carsten Feuerbaum, Fabian Gaessler · Journal of Public Economics · 22 May 2024
Read original sourceOpen access
Where this sits in the debate
Direction of the finding as read from the abstract by an AI model (AI-written).
Abstract
Despite a longstanding interest in the potential substitution of labor and capital, limited empirical evidence exists regarding the causal relationship between labor supply and the development of labor-saving technologies. This study examines the impact of exogenous changes in regional labor supply on automation innovation by leveraging a German immigrant allocation policy during the 1990s and 2000s. The findings reveal that an increase in the low-skilled workforce reduces automation innovation, as measured by patents. This reduction is most pronounced for large firms within the manufacturing sector and primarily concerns process-related automation innovations. This suggests that the effect is channeled through changes in internal demand for automation innovation. Consistent with a labor scarcity mechanism, the effect is confined to tight labor markets.
About this publication
Leading field journal. A leading journal in economics or a neighbouring field (on the Tinbergen Institute’s A list or near the top of the RePEc ranking), or a top-rated computer-science venue.
Placed by: Tinbergen Institute A list. How sources are ranked.
- Published
- 2024 (29 months ago)
- Citations
- 19 (OpenAlex)
Citations in context
19 citations — 26th percentile among the 23 indexed papers from 2024 in this collection. Citation counts favor older papers; this compares only same-year papers here, not the whole literature.
□ added to this collection in 2026.
author affiliation matches seed institution university college london — part of why this paper is in the collection.
Related by theme, not necessarily by method or conclusion.
- The Effects of Generative AI on High Skilled Work: Evidence from Three Field Experiments with Software Developers
SSRN · 2024 - GPTs are GPTs: An Early Look at the Labor Market Impact Potential of Large Language Models
arXiv · 2023 - Extending “GPTs Are GPTs” to Firms
AEA Papers and Proceedings · 2025 - New Frontiers: The Origins and Content of New Work, 1940–2018
The Quarterly Journal of Economics · 2024
Overview assembled automatically from collected metadata. How this site is built.