Robots, Trade and Employment in Italian Local Labour Systems

Three main shocks have affected advanced economies over the last 25 years, with significant consequences for work, production and economic growth. The first is technological change associated with robotics and the so-called Fourth Industrial Revolution. The second, which is partly related to the first, is the diffusion of ICT and the development of intelligent software applied both to industry and tertiary activities. The third is the strong competitive pressure from low cost and emerging countries, which have changed the geography of world production and trade flows, often within global value chains. Following the seminal papers of Acemoglu and Restrepo (2017) and Dauth, Findeisen, Südekum and Woessner (2017), the aim of this paper is to assess the impact of these three shocks on employment in Italian local labour markets in the period 1991-2011. What is new in our approach is the explicit consideration of the role played by the different typologies of local labour systems and industrial districts. We find that robots do not have any negative effect on employment in local labour markets. On the contrary, robots seem to be associated with a growth in overall employment, mainly due to the tertiary sector. The second result is that there is some evidence of a positive effect of ICT investments on local employment, in particular non-manufacturing employment. The last and most robust result of the econometric analysis is the negative impact of trade with low cost countries on local employment. This result has one almost absolute protagonist: China. All these impacts are not homogeneous across the national territory and partly depend on the characteristics of the local productive systems and industrial districts.