Lankisch, Clemens Prettner, Klaus Prskawetz, Alexia
Year of Publication:
ECON WPS No. 06/2017
We analyze the effects of automation on the wages of high-skilled and low-skilled workers and thereby on the evolution of wage inequality. Our model explains the simultaneous presence of i) increasing per capita income, ii) declining real wages of low-skilled workers, and iii) an increasing skill-premium. These developments are consistent with the experience in the United States over the past decades.