BICEPS/SSE Riga Research Seminar: Automation in an Open, Catching-Up Economy: Aggregate and Microeconometric Evidence

We are happy to invite you to a BICEPS/SSE Riga research seminar, which will take place on Thursday, December 7th, at 17:00 at SSE Riga, room 411.

We are delighted to welcome Amaresh Kumar Tiwari as the speaker. Amaresh is a lecturer and researcher at the University of Tartu. His research interests are in the fields of econometrics, industrial economics, and corporate finance. Amaresh holds a Ph.D. in economics from Maastricht University.

Title: Automation in an Open, Catching-Up Economy: Aggregate and Microeconometric Evidence
Time: Thursday, December 7th, 17:00
Venue: SSE Riga, room 411


Using the universe of firms in Estonia, we study the implications of imports-led and FDI-facilitated automation for productivity and factor shares of tasks and value-added. First, in contrast to the findings for the developed economies, we find that aggregate labor share of value-added for the automation adopting firms is higher than that for the non-adopters, and has grown, among others, through reallocation of economic activities towards the adopting firms. Second, concurrently, aggregate total factor productivity of the adopters grew faster than that of the non-adopters. Third, from the micro-level study we find that the estimated labor share of tasks has declined over time among the adopting firms and is lowest in firms that automate frequently, where the frequency of automation provides rich information on firms’ automation characteristics. The study emphasizes international spillover and creation of productive jobs by multinational adopters among the reasons for the increase in the labor share of value-added for the adopters even as their labor share of tasks declined. Fourth, productivity impact of automation is heterogeneous: (a) firms that automate regularly, (b) multinational adopters, and (c) firms that realize complementarities between automation and innovative management practices are among the most productive adopters; the third establishes that the innovative management practices instituted by the adopters are those that help discover and facilitate complementarities between automation and human labor.