Based on recent evidence from Europe, the paper shows that polarisation and upgrading are not mutually exclusive trends, but rather, simultaneously defined recent structural changes in employment. The results show that (a) the occupational structure shows a general shift towards high-skill jobs, (b) the prevailing upgrading patterns are often accompanied by job polarisation, as the share of middle-skill jobs declines in most cases, and (c) while low-skill employment often outperforms middle-skill jobs, it has tended to decline. In addition to analysing trends for EU-27 countries with different levels of development for the latest available time periods, the article also shows that occupational upgrading patterns are rather intertwined with job polarisation and are compatible with both the Skill-Biased Technical Change (SBTC) and Routine-Biased Technical Change (RBTC) hypotheses. The employment dynamics of low-skill workers are uncertain, as they are not fully compatible with any theoretical model, thus pointing to the need for a finer understanding of changes in occupational structure, and the extent to which both polarisation and upgrading are shaping the evolution of the labour force structure under the impact of (ongoing) technological change.

The emergence of large language models (LLMs) has made it increasingly difficult to protect and enforce intellectual property (IP) rights in a digital landscape where content can be easily accessed and utilized without clear authorization. First, we explain why LLMs make it uniquely difficult to protect and enforce IP, creating a ‘tragedy of the commons.’ Second, drawing on theories of polycentric governance, we argue that non-fungible tokens (NFTs) could be effective tools for addressing the complexities of digital IP rights. Third, we provide an illustrative case study that shows how NFTs can facilitate dispute resolution of IP on the blockchain.

Technical progress is considered a key element in the fight against climate change. It may take the form of technological breakthroughs, that is, shocks that induce significant leaps in the stock of knowledge. We use an endogenous growth framework with directed technical change to analyze the climate impact of such shocks. Two production subsectors coexist: one subsector is fossil-based, using a non-renewable resource, and yields carbon emissions; the other subsector uses a clean, renewable resource. At a given date, the economy benefits from an exogenous technology shock. We fully characterize the general equilibrium and analyze how the shock modifies the economy’s trajectory. The overall effect on carbon emissions basically depends on the substitutability between the production subsectors, the initial state of the economy, and the nature and size of the shock. We notably show that green technology shocks induce higher short-term carbon emissions when the two subsectors are gross complements, but also in numerous cases when they are gross substitutes.

This paper develops a theoretical framework to examine the technology adoption decisions of insurers and their impact on market share, considering heterogeneous customers and two representative insurers. Intuitively, when technology accessibility is observable, an insurer’s access to a new technology increases its market share, no matter whether it adopts the technology or not. However, when technology accessibility is unobservable, the insurer’s access to the new technology has additional side effects on its market share. First, the insurer may apply the available technology even if it increases costs and premiums, thereby decreasing market share. Second, the unobservable technology accessibility leads customers to expect that all insurers might have access to the new technology and underestimate the premium of those without access. This also decreases the market share of an insurer with access to the new technology. Our findings help explain the unclear relationship between technology adoption and the market share of insurance companies in practice.

We investigate whether the diseases for which there was more biomedical innovation had larger 1999–2019 reductions in premature mortality. Biomedical innovation related to a disease is measured by the change in the mean vintage of descriptors of PubMed articles about the disease. We analyze data on 286 million descriptors of 27 million articles about over 800 diseases. Premature mortality from a disease is significantly inversely related to the lagged vintage of descriptors of articles about the disease. In the absence of biomedical innovation, age-adjusted mortality rates would not have declined. Some factors other than biomedical innovation (e.g., a decline in smoking and an increase in educational attainment) contributed to the decline in mortality. But other factors (e.g., a rise in obesity and the prevalence of chronic conditions) contributed to an increase in mortality. Biomedical innovation reduced the mortality of white people sooner than it reduced the mortality of black people.

This paper examines the impact of financially constrained intermediate inputs on within-industry total factor productivity loss. Utilizing exogenous tax reforms in China as a natural experiment, our difference-in-difference analysis reveals that reduced tax burdens lead to increased firm-level intermediate inputs, particularly among financially constrained firms. We incorporate financially constrained intermediate inputs into a partial equilibrium model of firm dynamics. Our calibration suggests that financially constrained intermediate inputs play a quantitatively more important role in accounting for misallocation than financially constrained capital. The presence of financially constrained intermediate inputs introduces a downward bias in the measurement of value-added productivity, especially for firms in the top decile of gross-output productivity. As a result, the average “efficient” levels of capital and labor for the top decile firms in the standard Hsieh and Klenow (2009) exercise are lower than what is truly efficient.

Increasing electricity access remains a challenge, particularly in rural areas of sub-Saharan Africa. This study examines the case of Tanzania, where connection rates remain low even among rural households residing ‘under the grid’, and this despite substantial government subsidies for household connections. Using data from 1,774 rural households living within reach of the electricity grid, we investigate correlates of the low grid electricity uptake. We find that proxies for wealth are positively associated with connection status, while social network variables are less so. Capacity to pay thus appears to remain a major barrier, and in-house wiring costs emerge as a significant expense unaddressed by the existing subsidy scheme, exceeding grid connection costs sevenfold. Similar mechanisms influence the choice between grid electricity and traditional or solar energy sources. These findings inform the ongoing policy debate on subsidy design and the role of alternative energy sources in expanding access.

A balanced growth path that accounts for a decline in hours worked per worker approximates the evolution of today’s industrialized countries since 1870. This stylized fact is explained in an overlapping generations (OLG) model featuring two-period lived individuals equipped with per-period utility functions of the generalized log-log type proposed by Boppart and Krusell (2020) and a neoclassical production sector. Technological progress drives real wages up and expands the amount of consumption goods. The value of leisure increases, and the supply of hours worked declines. Technological progress moves a poor economy out of a regime with low wages and an inelastic supply of hours worked into a regime with high wages and a declining supply of hours worked. The balanced growth path is unique and stable. In the high wage regime, the equilibrium difference equation is available in closed form. A balanced growth path with declining hours worked may also be obtained with endogenous technological progress as in Romer (1986).

This article examines how consumer preferences towards silk fabrics changed in Catalonia over the course of the first sixty years of the 15th century. It argues that during the first half of the 15th century silk became a luxury fabric for the wealthiest households of Catalan urban society. This change was triggered by the crisis of Europe's most prestigious manufacturing centres of high-quality woollens. Moreover, this article also claims that the adoption of silk as Catalonia's newest luxury fabric entailed a transition from lighter and plain silks to more expensive and elaborate silk fabrics. Finally, it connects this sumptuary shift to the technological development of the Italian silk industry and its later diffusion in Europe.

Relying upon an original (country-sector-year) measure of robotic capital ($RK$), we investigate the degree of complementarity/substitutability between robots and workers at different skill levels. We employ nonparametric methods to estimate elasticity of substitution patterns between $RK$ and skilled/unskilled labor over the period 1995–2009. We show that: i) on average, $RK$ exhibits less substitutability with skilled workers compared to unskilled workers, indicating a phenomenon of “RK-Skill complementarity”. This pattern holds in a global context characterized by significant heterogeneity; ii) the dynamic of “RK-Skill complementarity” has increased since the early 2000s; iii) the observed strengthening is more prominent in OECD countries, as opposed to non-OECD countries, and in the Manufacturing sector, compared to non-Manufacturing industries.

Ensuring energy access for rural households is crucial for global sustainable development. Technologies like liquefied petroleum gas, biogas, and efficient cookers are touted as solutions, yet their adoption remains limited despite their potential health, economic, and environmental benefits. We conducted a meta-analysis of 50 studies in developing countries, integrating contextual factors to explore gender and other determinants impacting rural energy transition. Our findings underscore socioeconomic status, social capital, environmental concerns, and gender dynamics as pivotal factors. Notably, women's involvement boosts adoption rates by 7.90 per cent, yet cultural barriers often sideline them from these processes. Thus, our recommendations stress addressing women's roles as energy technology users to foster inclusive energy transitions.

This paper explores the (de-)routinisation of employment structure in developing countries, through the case of Morocco. We investigate employment (de-)routinisation from an often-overlooked perspective, aiming to elucidate the interplay between the dynamics of occupational employment composition by the level of routine tasks intensity and two structural aspects: premature deindustrialisation and the prevalence of informal labour.

Our findings, based on tertile analysis and regressions, do not fully support the hypothesis of employment structure de-routinisation. At the same time, we could not identify a clear process of routinisation similar to that observed in developing countries undergoing the first stage of the traditional structural transformation process. Rather, we identified an inverted U-shaped pattern in the dynamics of occupational employment, indicative of a rise in intermediate routine-intensive occupations.

We emphasise two key factors, with opposite effects that have contributed to this atypical pattern: The first aspect is premature deindustrialisation, which according to our shift-share decomposition, has adversely affected highly routine-intensive jobs, contrasting with the routinisation trend observed in countries that have experienced a more traditional process of structural transformation. The influence of premature deindustrialisation in terms of de-routinisation is somewhat mitigated by the increasing prevalence of occupations demanding intermediate routine tasks, particularly within the services and construction sector. Regarding the second structural aspect – the prevalence of informal labour – our three-way interaction model indicates a lower susceptibility of informal jobs to de-routinisation compared to their formal counterparts within the same industry. Consequently, the prevalence of informal employment has slowed down the process of de-routinisation of employment structure.

Iron toxicity is one of the constraints limiting rice production in Africa. This study used a randomized controlled trial to assess the impact of an iron toxicity-tolerant variety, named ARICA 6, on different outcomes and investment in modern inputs by smallholder farmers. Two rounds of data were collected from 520 rice-farming households in Guinea. Results showed that the use of ARICA 6 increased rice yield by 330 kg ha−1 and net income by US$ 120 ha−1. However, adoption of improved variety may not be enough to crowd in investment in modern inputs because farmers face other constraints.

Motivated by distributional concerns raised by recent breakthroughs in AI and robotics, we ask how workers would prefer to manage an episode of automation in a task-based model, which distinguishes between automation and traditional technical progress. We show that under majority voting with the option to implement a “partial” UBI (as transfers to workers) it is optimal to tax capital at a higher rate than labor in the long run to fund the partial UBI. We show that, unlike traditional technical progress, automation always lowers the labor share in the long run, justifying distributional concerns. A quantitative analysis of an episode of automation for the US economy shows that it is optimal from the workers’ perspective to lower capital taxes and transfers over the transition. Nevertheless, this policy increases worker welfare by only 0.7% in consumption-equivalent terms, compared with a 21.6% welfare gain to entrepreneurs, because the welfare gains to workers from lower capital taxes are second-order, while the gains to entrepreneurs are first-order.

Even at long time horizons, modern outcomes are in some sense bounded by history. Culture shapes how people interact and as it propagates across generations, groups with more common ancestors face less frictions to cooperation. This, in turn, affects institutional and technological diffusion, implying a society's history plays a crucial role in the causes of sustained long-run economic growth. To test this, we follow other studies by proxying for historical effects with genetic relatedness, which yields a temporal proportionality of shared common ancestry. Measuring cultural traits are more challenging. We develop a new systematic measure through network analysis of Wikipedia. Connectivity statistics over the encyclopaedia's hyperlink-directed network captures unique features of cultural relatedness. Further, as we index pages, we can coarsen the network into specific topics. The results show how history correlates broadly over a range of cultural factors. Differences across the coarsened networks demonstrate not simply that history matters, but where it matters less.

Dairy farming in Europe faces profound environmental, social, and economic sustainability challenges, which are of significant policy interest. These challenges support the need for a transition toward the uptake of more sustainable dairy farming practices. This paper examines the effects of an advisory instrument “balanced sustainability information” on farmers’ preferences for more grass-based feeding systems using a between-subjects design and a discrete choice experiment among a sample of Swedish dairy farmers. Conceptually, we develop a state-dependent utility framework with Bayesian updating to motivate the impact pathway. Our results demonstrate that on average, balanced sustainability information has negligible effects on farmers’ feed choices, which could be a consequence of opposing responses to the information, among others. Considering farmer heterogeneity based on their identities and prior knowledge, we find support for some evidence of treatment effects. Our findings highlight important and policy-relevant critical reflections about overoptimistic expectations of information provision as an instrument to nudge behavioral change toward more sustainable farming practices.

The rapid development of the digital economy has highlighted the crucial role of data in economic growth. This study investigates the impact of two types of innovation on long-term growth by incorporating data into a model of creative destruction and knowledge accumulation. Unlike traditional factors, data exhibit nonrivalry between the two research and development (R&D) sectors, thereby influencing the growth rate of economic outputs simultaneously without interference. Our findings reveal the existence of a balanced growth path (BGP) in both the decentralized economy and the social planner’s economy. In horizontal innovation, data can be transformed into digital knowledge to promote the economic growth [Cong et al. (2021)]. In addition to horizontal innovation, the utilization of data in vertical innovation also enhances the success rate of innovation, with a gradual decrease in per capita data usage on the BGP. Moreover, as agents accumulate human capital, the economy achieves higher output levels, effectively addressing consumer privacy concerns. However, along the transitional path, insufficient data provision by both R&D sectors leads to lower economic growth rates or more intense economic fluctuations, necessitating policy interventions.

Offshore wind farms (OWF) are now in operation and increasingly under construction as scalable, sustainable energy sources. In fact OWFs are currently the cheapest form of new energy projects in Europe. The levelized cost of energy (LCOE) for OWF has fallen drastically due to decades of innovation facilitated by both taxpayer and private sector funding. This emerging industry is experiencing massive worldwide growth with the potential to accelerate the decarbonization of regional and the global economy as well as bring a reliable source of green hydrogen into commercial use, all with minimal disruption to ecosystems and impacts on biodiversity. This paper provides a historical perspective of wind energy harnessing and shows that wind turbines are the oldest, largest and one of the smartest machines. We also highlight the potential of offshore wind energy to provide new solutions to (a) meet clean energy demand for a growing world population, (b) improve energy security of nations through other downstream technologies such as production and storage of dispatchable fuel (such as green hydrogen battery storage) and (c) through supply complementarity improve resilience of nuclear power plants in high-seismic-activity areas. Offshore wind industry can also become a gold standard for future industries, and the paper provides insights into the new green economics and jobs and factories for the future. We show that environment-friendly regulation is driving innovations even further to enhance sustainability of OWF. Examples include material recycling, landfill ban on blade disposal and ecofriendly low-noise offshore construction to protect biodiversity.

This paper examines the impact of trade-related technology diffusion from G7 countries to Latin America and East Asia on total factor productivity controlling for education, governance, and distance. We build on the trade and distance-focused strands of the technology diffusion literature and find that (i) total factor productivity (TFP) increases with education, trade, and governance (ETG) and declines with distance to the G7 countries; (ii) increasing Latin America's ETG to East Asia's level would double TFP, accounting for about 75% of the TFP gap between the two country groups; and (iii) South America's greater remoteness relative to Mexico's from the US and Canada significantly reduces its TFP and similarly for Singapore's greater remoteness from Japan relative to Hong Kong.