Page - (000088) - in Disrupted Development and the Future of Inequality in the Age of Automation

6 AUTOMATION, POLITICS, AND PUBLIC POLICY 81 Second, there is a class of “coping strategies” for the trend toward automation. The most prominent one is to develop the skills of the labor force and (re)train workers in the APS. A widespread policy recommen- dation is to invest in skills and thus move the labor force away from automatable routine tasks. The problem with this approach is that (i) it is not clear what skills will be automation-resistant for a sufficient time to make the skills investment worthwhile and (ii) whether upskilling is at all realistic given the required time and monetary investment. Competition with currently available technology increasingly seems to require a ter- tiary education which is still very rare throughout the developing world. Given that even advanced industrialized countries are struggling to keep their labor forces competitive, the success of a skills development strategy alone remains questionable. A second coping strategy would be to provide economic transition support as well as safety nets, unemployment insurance, or wage subsi- dies. This approach addresses the distributional skew which automa- tion may create. However, such transfers presuppose the existence of a Table 6.1 The space of potential public policy responses to automation Source Authors’ elaboration Coping Containment Managing structural change Adaptability of labor •Skills upgrading Employment generation •Post-industrialization/ARS •Investment in labor-intensive sectors •Public works programs •Active labor market policies Labor costs and regulation •Tax cuts on labor •Wage subsidies •Lower minimum wage Employment protection •Job protection legislation Automation costs and regulation •Taxes on automation •Regulation that complicates automation •Tariffs on imports of non- primary goods Managing inclusivity Unemployment protection •Transition support •Unemployment insurance •Universal basic income