The Impact of Industrial Robots on the Skill-Based Wage Gap

Abstract

In recent years, with the disappearance of the demographic dividend of the aging society and the requirements for high-quality economic development under the new normal, the application of industrial robots has rapidly advanced in the Chinese market. As an emerging driving force of technological progress, artificial intelligence has its own technological bias, but the existing literature has not paid attention to whether this bias will widen the income distribution gap of labor with heterogeneous skills. Based on this, this paper uses the panel data of 30 provinces from 2006 to 2015 to describe the application level of industrial robots with the import volume of industrial robots, and establishes a macro proxy indicator of skill-based wage gap according to the data of different skill industries to test the industrial robots in the Chinese context, using real effects on skills wage gaps, and conducting an analysis of geographic heterogeneity. In addition, further investigate the mechanism by which intelligent equipment exacerbates the skill-based wage gap, and analyze the possible “substitution effect”, “demand effect” and “asymmetric labor productivity effect” of the use of industrial robots on the skilled labor force. The results show that the use of industrial robots has a significant positive effect on the expansion of the skill-based wage gap. The use of industrial robots will exacerbate the wage gap between the high-skilled and low-skilled labor in the market. This effect comes from a combination of three effects: the “substitution effect”—the use of industrial robots will change the skill structure of employment, reducing the proportion of low-skilled workers; the “demand effect”—the use of industrial robots will change to some extent. The increase in demand for high-skilled labor has no significant impact on the demand for low-skilled labor.