--- title: "Industrial automation and local public goods · AI Fault Line" url: https://aifaultline.com/research/p/doi-10-1016-j-jpubeco-2025-105394/ description: "AI Fault Line is a neutral, evidence-cited field guide to why experts looking at the same developments disagree about AI's effect on productivity, jobs, inequality, regulation and the pace of change." --- [Research](https://aifaultline.com/research/) # Industrial automation and local public goods Thomas Luke Spreen, Ziyuan Wang, Lang Kate Yang · Journal of Public Economics · 26 May 2025 [Read original source](https://doi.org/10.1016/j.jpubeco.2025.105394) Open access Where this sits in the debate - [Will AI destroy more jobs than it creates?](https://aifaultline.com/debate/jobs/) Direction of the finding as read from the abstract by an AI model ([AI-written](https://aifaultline.com/about/)). ## Abstract Recent research shows industrial automation raises labor productivity but also depresses employment and wages in exposed industries and regions. This paper examines the impact of automation on U.S. state and local governments. We find that state and local governments with greater exposure to automation experience significant declines in per capita revenues and expenditures. The spending reduction is concentrated in K-12 education and is driven primarily by a decrease in state support. Automation exposure is also associated with a decline in student test scores. These findings suggest that industrial automation impairs state and local financing of public education and student outcomes. ## 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](https://aifaultline.com/about/#source-ranking). Published 2025 (17 months ago) Citations 2 (OpenAlex) ## Citations in context [Chart: 2 citations, cohort median 10] 2 citations — 21st percentile among the 33 indexed papers from 2025 in this collection. Citation counts favor older papers; this compares only same-year papers here, not the whole literature. [Chart: published 2025] □ added to this collection in 2026. ## More on this topic 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](https://aifaultline.com/research/p/doi-10-2139-ssrn-4945566/) SSRN · 2024 - [GPTs are GPTs: An Early Look at the Labor Market Impact Potential of Large Language Models](https://aifaultline.com/research/p/doi-10-48550-arxiv-2303-10130/) arXiv · 2023 - [Extending “GPTs Are GPTs” to Firms](https://aifaultline.com/research/p/doi-10-1257-pandp-20251045/) AEA Papers and Proceedings · 2025 - [New Frontiers: The Origins and Content of New Work, 1940–2018](https://aifaultline.com/research/p/doi-10-1093-qje-qjae008/) The Quarterly Journal of Economics · 2024 Overview assembled automatically from collected metadata. [How this site is built](https://aifaultline.com/about/).