Innovation and the labour market [ECONB313]

Learning outcomes

• Understanding the impact of technological change on the economy • Understanding how the labour market works • Developing critical thinking skills • Be able to apply theoretical concepts to a practical case

Objectives

Like other technological changes before it, the development of artificial intelligence will have an impact on the economy and society. Jobs previously done by workers will disappear and tasks will be taken over by computers. Will human work then become largely obsolete? What will be the impact on employment and unemployment, on wages, on inequality? Who will be the winners and losers? And how can the government minimise the negative impacts of artificial intelligence (and maximise the positive impacts)? The answers to these questions are obviously speculative (no one can predict the future), but there are lessons to be learned from past technological change. While technological change seems to have had a positive impact in the long term, there were undoubtedly short and medium term economic problems, at least in some sectors. Would the impact of change brought about by artificial intelligence be similar, or should we expect a more radical change? The aim of the course is to find (sketchy) answers to these questions, to understand what the labour market of the future might look like, and how the state can influence this market.

Content

The course starts with the question of innovation. What motivates companies to innovate? What means does the state have at its disposal to encourage innovation? Then we look at the functioning of the labour market. What is the impact of innovation on this market? Will there be an increase or decrease in wages? Will there be an increase or decrease in unemployment? And finally, what policies can limit the short-term problems while increasing the benefits to society as a whole in the long term? If there is time, we also look at the impact of innovation on competition between companies and the organisation of markets.