For Work / Against Work
Debates on the centrality of work

"The Race between Man and Machine: Implications of Technology for Growth, Factor Shares, and Employment"

by Acemoglu, Daron; Restrepo, Pascual (2018)


We examine the concerns that new technologies will render labor redundant in a framework in which tasks previously performed by labor can be automated and new versions of existing tasks, in which labor has a comparative advantage, can be created. In a static version where capital is fixed and technology is exogenous, automation reduces employment and the labor share, and may even reduce wages, while the creation of new tasks has the opposite effects. Our full model endogenizes capital accumulation and the direction of research towards automation and the creation of new tasks. If the long-run rental rate of capital relative to the wage is sufficiently low, the long-run equilibrium involves automation of all tasks. Otherwise, there exists a stable balanced growth path in which the two types of innovations go hand-in-hand. Stability is a consequence of the fact that automation reduces the cost of producing using labor, and thus discourages further automation and encourages the creation of new tasks. In an extension with heterogeneous skills, we show that inequality increases during transitions driven both by faster automation and introduction of new tasks, and characterize the conditions under which inequality is increasing or stable in the long run.

Key Passage

Automation allows firms to substitute capital for tasks previously performed by labor, while the creation of new tasks enables the replacement of old tasks by new variants in which labor has a higher productivity. (p.3)


Artificial Intelligence, Growth, Technology, Employment


Technology, Automation

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