Relying upon an original (country-sector-year) measure of robotic capital ($RK$), we investigate the degree of complementarity/substitutability between robots and workers at different skill levels. We employ nonparametric methods to estimate elasticity of substitution patterns between $RK$ and skilled/unskilled labor over the period 1995–2009. We show that: i) on average, $RK$ exhibits less substitutability with skilled workers compared to unskilled workers, indicating a phenomenon of “RK-Skill complementarity”. This pattern holds in a global context characterized by significant heterogeneity; ii) the dynamic of “RK-Skill complementarity” has increased since the early 2000s; iii) the observed strengthening is more prominent in OECD countries, as opposed to non-OECD countries, and in the Manufacturing sector, compared to non-Manufacturing industries.

This study utilises panel data of 46 countries from 2005 to 2019 to examine the impact of digital service trade (DST) on inclusive growth. Inclusive growth is a growth model that promotes economic growth and development, while also building social equity and inclusiveness and balancing environmental sustainability. The findings indicate that a nation’s DST development significantly fosters domestic economic growth and development, specifically through its employment enhancement effect. DST substantially promotes social equity and inclusiveness, mainly through the inclusive innovation effect. However, DST is also found to increase carbon emissions, impeding environmentally sustainable growth, specifically via the energy demand effect. Hence, DST exerts diverse impacts on different facets of inclusiveness. The study also reveals heterogeneity in the effects of DST on the three aspects of inclusive growth related to trade’s import–export dynamics, income levels, and DST barrier intensities. This paper contributes to and refines the body of research on the relationship between DST and inclusive growth. It offers policy suggestions for crafting more open and mutually beneficial DST policies to foster social equity and inclusive global trade.

We study whether the increased adoption of available automation technologies allows economies to avoid the negative effect of aging on per capita output. We develop a quantitative theory in which firms choose to which extent they automate in response to a declining workforce and rising old-age dependency. An important element in our model is the integration of two capital types: automation capital that acts as a substitute to human labor, and traditional capital that is a complement to labor. Empirically, our model's predictions largely match data regarding automation (robotization) density across OECD countries. Simulating the model, we find that aging-induced automation only partially compensates the negative growth effect of aging in the absence of technical progress in automation technology. One reason is that automated tasks are no perfect substitutes for non-automated tasks. A second reason is that automation raises the interest rate and thus inhibits positive behavioral reactions to aging (later retirement and investment in human capital). Moreover, increased automation generates a falling net labor share of income and rising welfare inequality. We evaluate alternative policy responses to cope with this inequality.

On 1 January 2016, China further relaxed its family planning policy and adopted the universal two-child policy, which allows any Chinese couple to have two children to address the country’s increasingly severe ageing problems and low fertility. With this shift comes a direct and profound impact on society, especially women; this paper evaluates the effect of the universal two-child policy on the gender wage gap and its mechanism. Several major conclusions emerge from this analysis. The policy significantly expands the urban gender wage gap by 12.86% in the low-policy-fertility-rate (PFR) provinces versus high-PFR provinces. Evidently, it increases the gap among younger or lower-educated people. Moreover, the severity of gender discrimination in the labour market after the implementation of the universal two-child policy is rising, and deserves further attention.

This study relies on a linear programming model to estimate welfare ratios in Spain between 1600 and 1800. This method is used to find the food basket that guaranteed the intake of basic nutrients at the lowest cost. The estimates show that working families in Toledo had higher welfare ratios than in those in Barcelona. In addition, the welfare ratios of Spain were always below those of London and Amsterdam. The divergence between Northern Europe and Spain started before the Industrial Revolution and increased over time.

Several decades ago, Sig Prais concluded that the root cause of the UK’s poor industrial performance was the poor quality of education and training. In this lecture, I will make a related argument, focussing on the lack of opportunity in the United Kingdom for workers who have not succeeded in the formal education system and the long-lasting impacts this has on their economic, health and social wellbeing. I will highlight the importance of providing opportunities for continued training over a worker’s lifetime for appropriate skills that are valued in the workplace in order to achieve inclusive growth.

This study investigates the relationship between occupational skills and wages in Thailand using the Labour Force Survey from 1985 to 2020. We quantify the contribution of changes in the skill requirement and highlight the increase in the return on the ‘brain’ and the decrease in the penalty on ‘brawn’, which helps explain the wage distribution changes across periods. We further explore the polarisation in the labour market and analyse the changes in the wage distribution by applying the decomposition method proposed by Firpo et al (2009). Our results suggest that wage dispersion increases in the top end over the first two time periods but decreases in the third time period, while it continues to decrease in the lower end of the distribution.

The introduction of the 2012 Labour Code is considered ‘groundbreaking’ in industrial relations in Vietnam. However, knowledge about the effects of this law is still minimal. This study provides the first evidence of the impacts of the law on worker outcomes, disaggregated by location and migration status. The Vietnam Labour Force Survey is used as the primary dataset. Both difference-in-differences and fixed-effect models are applied in the investigation. The estimated results show a relationship between the introduction of the law and the labour supply of contracted workers in urban areas, especially long-term migrant workers. Furthermore, income for these long-term migrant contract workers was affected significantly by the introduction of the law. A link between the law and health insurance participation was also found among non-migrant contracted workers in urban areas. We also perform estimations using a short panel sample and find notable results. The study likewise reveals disadvantages of rural workers compared to urban workers in terms of earnings, and of short-term migrants compared to other workers, in terms of labour supply.

This research note documents the revision of a dataset of real wages in Argentina, Brazil, Chile, Colombia, Mexico and Venezuela during 1920-2011. This resource was originally published by this journal in Astorga (2017). The revision affected all eighteen basic wage series plus six weighted-average series, with varying degrees of modification. The revised dataset is made available as supplementary material. Regardless of changes to the data, the key findings and conclusions of the 2017 paper still hold.

The canonical income process, including autoregressive, transitory, and fixed effect components, is routinely used in macro and labor economics. We provide a guide for its estimation using quasidifferences, cataloging biases in the estimated parameters for various $N$, $T$, initial conditions, and weighting schemes. Using Danish administrative data on male earnings, estimation in quasidifferences yields divergent estimates of the autoregressive parameter for different weighting schemes, which conforms to our simulation results when the variance of transitory shocks is higher than that of persistent shocks, true persistence is high, and the persistent component’s variance in the first sample year is nonzero. We further apply quasidifferences to the data from a calibrated lifecycle model and find significant biases in the persistence of shocks and their insurance. Estimation of the income process using quasidifferences is reliable only when the variance of persistent shocks is higher than that of transitory shocks and the moments are equally weighted.

This paper focuses on the migrant pay gap in Spain. Going beyond descriptive evidence of the differences between immigrants and nationals in terms of wages, we analyse which part of the gross wage is most affected by features that cannot be captured using econometric models. Relying on microdata from the Wage Structure Survey, we divide the total gross wage into two main parts: base wage and wage supplements. Then we decompose the migrant wage gap into the explained and the unexplained terms, using a simple decomposition methodology, the Oaxaca-Blinder model. Our results show that a part of the differences in wage supplements does not seem to be explained by the set of control variables introduced in the model and that this effect is more pronounced when only men are considered. These findings offer a new perspective on the migrant pay gap in Spain and point to the importance of wage-setting practices related to wage supplements in explaining (and widening) the total migrant pay gap in our country.

The effect of trade liberalisation on the welfare of workers depends on the nature and magnitude of switching costs that workers face in moving across sectors. This paper investigates the impact of trade liberalisation on the gender wage gap in China, emphasising the role of sectoral switching costs in driving the effect. Using the local labour market approach as the identification strategy, I find that a one-standard-deviation increase in regional trade exposure is associated with a 3.2% increase in the gender wage gap during the 1992–2009 period. The emergence of the empirical pattern is mainly because the sectoral switching costs are larger for females than males. Since trade liberalisation leads to labour reallocation across sectors, the presence of asymmetric sectoral switching costs thus prevents female workers initially employed in the manufacturing sector from accessing advanced service industries, resulting in a rising gender wage gap after the trade. As a response, female manufacturing workers are forced to either be employed in low-skill service industries or exit the labour market. This paper carries strong implications for policies that both promote gender equity and help trade-displaced workers.

The compensating wage differential (CWD) for nonfatal injury and value of statistical life or injury in occupations have rarely been analysed separately by gender or race. This paper uses individual-level data from the 2012–2015 March Current Population Survey to estimate the CWD as well as the value of statistical injury (VOI) by race and gender. We find male workers command a positive risk premium, and this is higher when they are unionised. We also find a positive risk premium for White unionised workers and a slightly lower risk premium for White males. Like other investigators, we find that nonfatal risk is heterogenous, and its compensation is difficult to estimate using a standard wage equation, even with some smaller subsamples from our dataset that are gender- or race-specific. Our estimates of the VOI show us that male workers who are unionised have the highest VOI, followed by Hispanic union workers, and Black females. This last finding follows from Black females working in jobs that have the highest risk rates compared to White and Hispanic females.

Does technological change fuel political disruption? Drawing on fine-grained labor market data from Germany, this paper examines how technological change affects regional electorates. We first show that the well-known decline in manufacturing and routine jobs in regions with higher robot adoption or investment in information and communication technology (ICT) was more than compensated by parallel employment growth in the service sector and cognitive non-routine occupations. This change in the regional composition of the workforce has important political implications: Workers trained for these new sectors typically hold progressive political values and support progressive pro-system parties. Overall, this composition effect dominates the politically perilous direct effect of automation-induced substitution. As a result, technology-adopting regions are unlikely to turn into populist-authoritarian strongholds.

Singapore’s Progressive Wage Model, introduced in 2012 and mandatory in the cleaning industry since 2015, is a skills- and productivity-based approach to redesigning jobs and restructuring wages in the largely outsourced cleaning, security and landscaping sectors. Focusing on cleaning work in the food and beverage industry, this case study examines some early outcomes of this national drive to reduce wage inequality by improving the pay and conditions of commodified work in a sector subject to outsourcing-based cost competition. Based on interviews with cleaners, supervisors and managers, the findings suggest that in general, government and the trade union and employers’ association have worked together, to set wages and conditions transparently. Nevertheless, enforcement issues mean that cleaners remain vulnerable. They have limited information about their employment benefits and face various types of poor conditions, some sanctioned by and others in violation of labour laws. These vulnerabilities have structural roots, including rent imbalances and cheap sourcing, factors that commodify jobs. The implementation of the Progressive Wage Model may have helped de-commodify cleaning jobs for Singaporeans and permanent residents, but such outcomes are still dependent on non-systemic and unenforceable factors such as the kindness of individual supervisors. While a promising start has been made, Singapore’s initial efforts to improve incomes and conditions in low-wage work will nevertheless require stronger regulatory commitment.

Increasing awareness of the productive potential of soft skills has sparked a discussion of their systematic and purposeful development. However, education systems pay only limited attention to this topic in most countries and remain focused on the development of hard skills. Is this approach rational or inadequate? This article provides new evidence on different aspects of the wage returns to soft skills (as an approximation of their productivity), and thereby contributes significantly to the discussion of the role of educational institutions in their development. It provides evidence that soft skills are as productive as hard skills. Moreover, it suggests that the productivity of hard skills stems from their combination with soft skills. These conclusions do not correspond to the fact that the value of education is intermediated mainly by hard skills, resulting in unequal development of soft and hard skills in schools. While concluding that education systems should pay more attention to soft skills development, the analysis recognises that this attention should be differentiated according to employers’ needs, owing to substantial differences in the value of soft skills across economic sectors. It is also noteworthy that while significant gender differences in returns to hard skills were identified, wage returns to soft skills appear gender neutral.

Neoliberal policies of industrial relations decentralisation and privatisation have transformed the economic landscape of Australia in the last 20 years. The primary objective of these policies has been to enhance wealth and prosperity by improving productivity and flexibility of the workforce and competition and accountability in the market. Yet the evidence suggests that precarious workers are not benefiting from this increased prosperity, indeed they suffer by comparison with all other workers. Cleaners are a subset of precarious workers who have been hard hit by the dual impacts of labour market decentralisation and privatisation. This study finds quantitative evidence of an increasing gap in earnings between cleaners and other workers in Australia since the onset of workplace relations decentralisation and the proliferation of privatisation in the mid 1990s. We locate our argument in recent debates about the nature of variegated neoliberalism, the emergence of the networked economy, and the implications of these developments for the nature of work and employment.

Chinese domestic rural–urban migrant workers have played a substantial role in economic development since the late 1970s. This article makes an attempt to establish a two-period hiring model interpreting the impact mechanism of social networks on migrant workers’ wages. The findings indicate that the extension of social networks of both firms and workers facilitates a decrease in the information gap between them and improves extra common benefits to both.

This is an edited version of the 2015 Fay Gale Lecture soon after the author’s retirement as Director of the University of South Australia’s Centre for Work + Life. It begins with the author’s personal work reminiscences as a touchstone for reflecting on continuity and change in women’s working lives. A first job in sheep-shearing sheds illustrates the insecurity and hard physical and emotional labour associated with manual work. Despite strides in Australian women’s qualification levels, discrimination is being ‘refreshed and remade’. Examples include recent Australian reversals in paid parental leave policy and the role of sexual harassment in patrolling work boundaries. The institutional basis of unequal pay and inflexible work/family time allocation is demonstrated in the Productivity Commission’s 2015 Workplace Relations agenda. This recommends reduced Sunday penalty rates that will disproportionately affect feminised, low-paid retail and hospitality work and rejects any strengthening of parents’ statutory right to request flexible work arrangements. Three remedies are proposed – creative approaches to research, campaigning and political action.

This historical paper analyses the distributional consequences of computerisation on the wage share of income in United Kingdom (UK) workplaces in the first decade of this century. The reasons why computerisation might increase a firm’s income but reduce the share assigned to wages are still not well understood. The uniquely rich Workplace Employment Relations Survey (WERS) 2004–2011 includes firm-level measures of the main production inputs and outputs, and thus allows an analysis of the main mechanisms through which increased computer usage influenced the wage share of income in UK workplaces over this period. This analysis shows that the proportion of employees using computers impacted the wage share in ways that were at odds with two mainstream views: that computers complement capital, and that labour can be easily replaced by capital. The results show that the proportion of employees using computers reduced the wage share by disproportionally increasing the productivity of the least skilled employees, who were not proportionally compensated for their increase in productivity. The stability of the wage share, over the period of interest, is explained by the rise in a workplace’s share of professional employees and by a rise in work effort. This positive contribution to the wage share was counteracted by an increased share of employees using computers and by a reduction in the share of employees whose pay was negotiated by unions, thereby contributing to a decline in the wage share of firm income.