April 2019

IZA DP No. 12281: Is an Army of Robots Marching on Chinese Jobs?

A handful of studies have investigated the effects of robots on workers in advanced economies. According to a recent report from the World Bank (2016), 1.8 billion jobs in developing countries are susceptible to automation. Given the inability of labor markets to adjust to rapid changes, there is a growing concern that the effect of automation and robotization in emerging economies may increase inequality and social unrest. Yet, we still know very little about the impact of robots in developing countries. In this paper we analyze the effects of exposure to industrial robots in the Chinese labor market. Using aggregate data from Chinese prefectural cities (2000-2016) and individual longitudinal data from China, we find a large negative impact of robot exposure on employment and wages of Chinese workers. Effects are concentrated in the state-owned sector and are larger among low-skilled, male, and prime-age and older workers. Furthermore, we find evidence that exposure to robots affected internal mobility and increased the number of labor-related strikes and protests.