Technological Change, Offshoring, and Labour Market Institutions in International Perspective

Thursday, April 14, 2016
Aria A (DoubleTree by Hilton Philadelphia Center City)
David Rueda , Political Science, University of Oxford
Stefan Thewissen , Institute for New Economic Thinking, University of Oxford
Technological change and offshoring are widely seen as important causes of earnings inequality by complementing occupations with certain skill profiles while making others redundant (Autor et al., 2003; Goos & Manning, 2007). Yet, technological innovation and offshoring are not isolated market forces. Labour market policies and institutions can affect the ease of offshoring or automation by providing secure employment to certain groups while not protecting others (Hall & Soskice, 2001; Rueda, 2007). In our paper we examine the characteristics of the groups vulnerable to technological change and offshoring for 23 European countries between 1993 and 2012 using comparative survey data. We track what the characteristics are of the individuals in these occupations in terms of their precariousness of employment and wage. Next, we relate this to trends in employment protection and active and passive labour market policies, to see which welfare states have tried to mediate risks stemming from technological change and offshoring, and whether they have been successful in doing so. We aim to contribute to the existing comparative political economy literature by devoting explicit attention to technological change in addition to offshoring. While offshoring has been subjected to scrutiny (e.g., Walter, 2010; Wren & Rehm, 2013), technological change has largely been neglected thus far. The research links to our previous findings that individuals in more routine occupations susceptible to automation demand higher levels of redistribution (Thewissen & Rueda, 2015), and to existing studies on welfare support coalitions (Gingrich & Hausermann, 2015).