Page - (000079) - in Disrupted Development and the Future of Inequality in the Age of Automation

72 L. SCHLOGL AND A. SUMNER and 2014 (fitted lines) shows a surprising degree of continuity over time. What appears to be happening, though, is an expansion of service- sector employment in the richest countries, and a reduction in the share of industrial work compared to the early nineties (this pattern is corrob- orated by Wood, 2017). In line with this, Chandy (2017, p. 14) spec- ulates that “China may be one of the last countries to ride the wave of industrialization to prosperity.” Generally, most of the global cross-coun- try variability of employment shares is found toward the low end of the GNI per capita, whereas countries above a per capita GNI of 20,000 look structurally very similar, i.e. are highly service-based and thus face lower automatability. In general, it is only in the poorest countries that a considerable proportion of labor is in agriculture. However, even in mid- dle-income developing countries such as Indonesia and Thailand, a third of the labor force remains in agriculture. Agriculture employs only a few percent of labor force in wealthy countries. This suggests that in contrast to OECD countries, many jobs in developing countries have likely been automatable for a long time. notes 1. Roine and Waldenström (2014) suggest a new Kuznets curve based on technological developments starting not a sectoral shift of agriculture to industry but a shift from traditional industry to technologically inten- sive industry. If a given technology makes skilled workers more produc- tive and there is an increase in the relative demand for those workers, the rewards accrue to a small proportion of the population who are skilled workers. Based on Tinbergen’s (1974, 1975) hypothesis that the returns to skills are a competition between education and technology, the sup- ply of skilled workers then determines whether or not their wages rise. Roine and Waldenström argue that the drivers of the Kuznets downturn are political and exogenous shocks. 2. McMillan and Rodrik show how structural change had been growth- enhancing in Asia because labor has transferred from low to higher pro- ductivity sectors. However, the converse is the case for sub-Saharan Africa and Latin America because labor has been transferred from higher to lower productivity sectors and this has reduced growth rates. They find that countries with a large share of exports in natural resources tend to experience growth-reducing structural transformation and, even if they have higher productivity, cannot absorb surplus labor from agriculture.