Robots and the gender pay gap in Europe

Abstract

Could robotization make the gender pay gap worse? We provide the first largescale evidence on the impact of industrial robots on the gender pay gap using data from 20 European countries. We show that robot adoption increases both male and female earnings but also increases the gender pay gap. Using an instrumental variable strategy, we find that a ten percent increase in robotization leads to a 1.8 percent increase in the gender pay gap. These results are mainly driven by countries with high levels of gender inequality and outsourcing destination countries. We then explore the mechanisms behind this e↵ect and find that our results can be explained by the fact that men at medium-and high-skill occupations disproportionately benefit from robotization (through a productivity e↵ect). We rule out the possibility that our results are driven by mechanical changes in the gender composition of the workforce nor by inflows or outflows from the manufacturing sector.

Innovation as a Firm-Level Factor of the Gender Wage Gap

“…For example, there is some evidence suggesting that the adoption of IT has historically favoured more women on the labour market, due to changes in task structure (Black andSpitz-Oener 2010, Yamaguchi 2018) and the smaller relevance of physical skills (Weinberg 2000). At the same time, recent evidence on the effects of another key technology, automation, in the labour market suggests that automation is associated with increasing gender gaps in the labour market (Brussevich et al 2019), including a higher gender-based wage gap in Europe (Aksoy et al 2020). These effects have been argued to be the result of a different distribution of routine and non-routine tasks among jobs for men and women (Aksoy et al 2020, Brussevich et al 2019.…”

“…At the same time, recent evidence on the effects of another key technology, automation, in the labour market suggests that automation is associated with increasing gender gaps in the labour market (Brussevich et al 2019), including a higher gender-based wage gap in Europe (Aksoy et al 2020). These effects have been argued to be the result of a different distribution of routine and non-routine tasks among jobs for men and women (Aksoy et al 2020, Brussevich et al 2019. Automation and robotization decrease the relative demand for services in those labour groups that engage more in routine tasks (Brussevich et al 2019, Blanas et al 2019).…”

“…Much of the empirical analysis on innovation and the gender wage gap focuses on the role of technological innovations such as IT (Weinberg 2000) or automation (Aksoy et al 2020). Some research has also focused on the role of investments in intangibles (Asplund and Napari 2011), or specific organisational practices, such as various high-performance work practices, such as job rotation, incentive pay, self-managed teams and project based teams (Datta Gupta and Eriksson 2012, Davies et al 2015).…”

“…Much of the relevant prior analysis focuses on the effects of technological novelties, especially on the effects of automation (e.g. Aksoy et al 2020) and IT on wages or gender related labour market outcomes.…”

“…In particular, we contribute by complementing the analysis of the effects of technological innovation and R&D with those of non-technological innovation and firm 'openness' in innovation. This enables us to observe whether the recent evidence (Aksoy et al 2020) that the adoption of some key technologies, such as automation, are associated with higher gender pay gaps, is specific to a certain type of innovation, or whether such effects of innovation are more general and visible across different types of innovation indicators and key innovation activities.…”