Effects of automation on the gender pay gap: the case of Estonia
Date
2021
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Abstract
This paper investigates how investments in automation-intensive goods affects the gender pay
gap. The evidence on the effects of automation on the labour market is growing; however, little
is known about the implications of automation for the gender pay gap. The data used in the
paper are from a matched employer-employee dataset incorporating detailed information on
firms, their imports, and employee-level data for Estonian manufacturing and services
employers for 2006–2018. We define automation using the imports of intermediates embedding
automation technologies. The effect of automation is estimated using simple Mincerian wage
equations and the causality of the effect is validated using propensity score matching. We find
that introducing automation enlarges the gender pay gap. The negative effect of importing
automation-intensive goods for female employees is about two to four percentage points
larger than for male employees. The propensity score matching confirms that the introduction
of automation has a higher causal effect on the wages of male employees than female
employees.
Description
Keywords
automation, technological change, robotization, gender pay gap, Estonia