Automation with Heterogeneous Agents: the Effect on Consumption Inequality
Research, Outreach, Seminar
Welcome to Economics Lunch Webinar organized by the Department of Economics, SSE. Tommaso Santini, UAB, will present the paper "Automation with Heterogeneous Agents: the Effect on Consumption Inequality".
This is an online seminar which will take place via Zoom.
2020-05-11 at 12:05
2020-05-11 at 13:00
Tommaso Santini, Universitat Autonoma de Barcelona and Barcelona GSE (ENTER)
Tomasso works on the macroeconomic effect of job automation. In the paper that will be presented, he studies the effect of automation on consumption inequality using a heterogeneous agent model. In another project Tommaso together with a co-author focus on the relationship between technological change and the gender wage gap. Tomasso is also interested in Economics Growth and Political Economy.
Tommaso will present the paper "Automation with Heterogeneous Agents: the Effect on Consumption Inequality".
ABSTRACT: I investigate what is the relationship between job automation and consumption inequality, in a dynamic model where high and low-skill workers differ with respect to their productivities. I consider two channels through which automation affects inequality: the skill that an agent can supply in the labor market and the level of capital she owns. As low-skill workers are relatively more substitutable by capital than high-skill workers, this tends to increase wage inequality. On top of this, as low-skill workers earn a lower labor income, their wealth is also smaller. As automation increases the demand for capital, it raises the interest rate, and this increases the wealth of the rich relatively more than the wealth of the poor. To consider these two effects in a unified framework with endogenous educational choice is the contribution of this work. I quantitatively show that ignoring education decisions can lead to a substantial overestimation of the effect of automation on consumption inequality.
The EUROPEAN NETWORK FOR TRAINING IN ECONOMIC RESEARCH (ENTER) is a cooperative venture between eight leading European Economics Departments, located in Barcelona (Spain), Brussels (Belgium), London (United Kingdom), Madrid (Spain), Mannheim (Germany), Stockholm (Sweden), Tilburg (the Netherlands) and Toulouse (France).
ENTER exchange seminars offer students the possibility to visit universities in the network to present papers and interact with students and faculty members in the other institutions.
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