This project aims at analysing the relationship between digitalization, earnings inequality, political preferences and the welfare state following three intertwined strands of research. First, we will explore the relationship between digitalization, employment and wages relying on novel techniques to capture the degree of jobs' digitalization. Second, we will test whether the risk of technological unemployment has an impact on citizens' redistributive preferences. Third, we will assess the possible policy challenges for welfare states and pension systems in the new era of digitalization and automation.
In the first strand, we will explore the link between the digitalization of productive processes, the level of routineness of job tasks and changes in employment and earnings. In line with the recent literature, we will rely on two digitalization indexes: a digital use index and a digital tasks index. The analysis is carried out at the EU27 level thus providing cross-country comparisons, also devoting a specific focus to the case of Italy by using administrative data.
In the second strand, making use of the European Social Survey, we will test whether occupational risks related to routine-biased technological change are associated with different preferences for redistribution and for the type of income support devoted to the unemployed and the poor, e.g. a minimum income or an universal basic income.
In the third strand, we will propose an analytical grid consistent with a forward-looking perspective in order to analyse challenges for different types of welfare and pension systems associated with various scenarios about the effects on employment and income distribution engendered by digitalisation and automation. According to this grid, we will then assess which types of welfare and pension systems are better able to cope with the challenges due to technological progress, also proposing policy suggestions according to the type of scenario which might occur.
