Robots at Work in China

The authors of the paper presented in this ZEW Research Seminar construct a unique dataset to study the effect of robot adoption on firm-level productivity and employment in China. They find that robot adoption leads to higher levels of productivity and employment, on average. However, Chinese state-owned enterprises (SOEs) do not exhibit the same productivity boost as private firms when adopting robots. They propose two explanations for this result: (1) Chinese SOEs inability to hire the appropriate human capital necessary to take advantage of investment in robots and (2) Chinese SOEs inability to make the necessary investments in complementary assets needed to obtain productivity improvements. They find evidence consistent with the first explanation but not the second.