The local labor market effects of modern manufacturing capital: evidence from France

Aghion, Philippe ORCID: 0000-0002-9019-1677, Antonin, Celine, Bunel, Simon and Jaravel, Xavier ORCID: 0000-0001-9228-2137 (2023) The local labor market effects of modern manufacturing capital: evidence from France. AEA Papers and Proceedings, 113. 219 - 223. ISSN 2574-0768

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Abstract

Using an event study methodology and comprehensive micro data from the French manufacturing sector, we analyze the local labor market effects of investments in modern manufacturing capital, including modern automation technologies. We estimate that commuting zones with higher investments in modern manufacturing capital and automation benefit from higher labor demand, with an increase in both local employment and wages. Our findings are consistent with a task-based model where the productivity effects of modern capital investments and automation outweigh their displacement effect.

Item Type:	Article
Divisions:	Economics
Subjects:	H Social Sciences > HD Industries. Land use. Labor
JEL classification:	D - Microeconomics > D2 - Production and Organizations > D20 - General G - Financial Economics > G3 - Corporate Finance and Governance > G31 - Capital Budgeting; Fixed Investment and Inventory Studies G - Financial Economics > G3 - Corporate Finance and Governance > G32 - Financing Policy; Financial Risk and Risk Management; Capital and Ownership Structure J - Labor and Demographic Economics > J2 - Time Allocation, Work Behavior, and Employment Determination and Creation; Human Capital; Retirement > J23 - Employment Determination; Job Creation; Demand for Labor; Self-Employment L - Industrial Organization > L6 - Industry Studies: Manufacturing > L60 - General M - Business Administration and Business Economics; Marketing; Accounting > M5 - Personnel Economics > M51 - Firm Employment Decisions; Promotions (hiring, firing, turnover, part-time, temporary workers, seniority issues) R - Urban, Rural, and Regional Economics > R2 - Household Analysis > R23 - Regional Migration; Regional Labor Markets; Population
Date Deposited:	07 Jan 2025 10:54
Last Modified:	07 Jan 2025 11:00
URI:	http://eprints.lse.ac.uk/id/eprint/126602

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