Brave New World

One of the pressing questions arising from the rapid adoption of artificial intelligence and other automation technologies is whether they will create more jobs than they eliminate. So far, research has focused mostly on very specific technologies, such as industrial robots or certain applications of AI, or an array of digital technologies commonly referred to as “automation technologies”. It would be great if the analyses were more fine-grained, both as regards individual technologies and the occupations and regions most affected.

Have Skills, Will Travel

Just fresh out of high school, you face a fairly momentous decision for your future: what will offer you a better wage premium over your career life? So far, the answer has usually been “a PhD”, because it translates into around 17% more income over the years.

But things are changing. Some emerging professions, such as those in the field of artificial intelligence or the green transformation, are new enough that there are not many people around with formal university education in either. And that means that in these fields labour supply currently does not meet industry demand.

Unlikely Megastars

Central bankers do not have it easy. In the good old days before the financial crisis of 2008, their audience was mainly financial market participants, who were well versed on financial and monetary issues. After the crisis, however, they saw the need to also communicate with the general public—i.e., firm managers and households—since they shape aggregate demand and inflation, given that changes in their beliefs affect their economic choices regarding investment or consumption spending. So, financial market gurus and firms and Jane and John alike prick up their ears when central bankers, unlikely megastars of our day and age, report on their meetings, everyone lapping up their words.  

A Woman's Touch

What is the ultimate measure of success for a manager? Shareholder returns? Peer recognition? Satisfied workers? Own paycheck? It depends on whom you ask. If you ask the managers themselves, it is, well, peer recognition is important, yes, but paycheck? Yeah, that’s the one.

Mr. AI Will See You Now

Large language models, a kind of artificial intelligence trained on billions of texts found on the Internet, have proved impressive at a number of tasks previously thought of as only possible for humans. Poems, term papers, computer code, essays, even academic research. It is no stretch of the imagination then to assume that service providers relying to a large extent on freely available information could be rendered obsolete by advanced AI tools.

The Dragon and the West

Europe is still scratching its collective head about what to do with China. Too important to ignore, too economically relevant to decouple from, too politically different to just keep up business as usual. So, de-risking is the word of the day, whatever that means.

But where do the differences between Europe and China come from? And do they imply that both are fated to remain so institutionally different forever?

Early-Bird Advantage

At first sight it is a bit of a paradox. On the one hand, it has long been clear that the skills you acquire, say, at university no longer will see you through to the end of your career life: you have to reinvent yourself several times along the way just to stay current. On the other hand, the skills that you learn early in your career will boost your earnings throughout your entire working life.

This suggests that vocational education, which typically imparts skills early in a person's career, can have a long-lasting positive impact.

Girls Next Door

Nowadays we are surrounded by peer networks. There are those virtual social ones, where you work hard at adding peers (“friends”) as if they were scores in a game, most of which you barely remember and will never meet again. Then there are those professional networks where your peers are called “connections” and where past job experiences tend to wax lyrical. But the peer network that counts, according to a recent CESifo study, is the one you had outside school when you were a high school student. Provided, that is, that that peer network contained a significant number of females.

Working from Home, Shopping Close to Home

The covid pandemic lent respectability to working from home, which means that the proportion of people wearing slippers to the “office” and working with a cat on their lap may stay higher than before the lockdown forced them into such sacrifices.

Wheels of Fortune

It is a common reality: aiming to enhance its human capital formation, a developing African country builds new schools and then… the boys are there, most girls aren’t. It is not just deep-seated cultural constraints that keep the girls away: it’s the walking to school and back, with whistling at best and sexual harassment at worst. Not to mention the 110-minute trek—one way—that saps energy and torpedoes punctuality.

Unlikely Bedfellows

Conventional wisdom has it that Chinese foreign aid could sway public opinion in the recipient countries towards autocratic political systems, since its aid comes free of the pesky finger-wagging associated with Western official development assistance. With such no-strings-attached aid pouring into Africa, Asia and Latin America, the Western camp frets that it may be losing the soft-power contest for the promotion of democratic values, right in the midst of the strategic competition between the US and China. Should the West then relax the conditionality it always attaches to its aid?

When Skipping School is a Good Deed

What happens when politicians get Greta-Thunberg’d into paying attention to young voices? They start listening, it appears, to judge from the way a good many of them are trying to out-green each other of late. Wait, does that mean that they can actually be swayed by people who can’t even vote yet? Sounds outlandish.

So maybe the real question should be: What happens to the parents of these young people who take to the streets to voice their concerns about climate change? New research by a group of scholars at the ifo Institute and colleagues from the Technical University Braunschweig and the University of York decided to investigate what effects youth protest movements have on the political arena, and how these effects come about.

Eat Your Greens

We are all for green, of course. Good for the health—mine, yours, the environment’s, the planet’s and all that. But wait, you don’t mean to put it right next to me, right? And what, I have to pay for it?? That’s the moment when the politician proposing a given green initiative goes into many voters’ won’t-vote-for-that-one list.

Aside from behavioural changes, two things are needed to slow down global warming and environmental degradation: technological solutions and political acceptance. But the more progress is done on the technological front, the stronger the political challenge seems to grow. Small wonder then that some politicians hesitate before introducing green policy measures. What’s worse, they may refrain of proposing such policies altogether. And that could prove disastrous.
 

Does Democracy Make You Taller?

Democracies have lately been derided by some as being less effective in fighting pandemics: the waves of covid-19 infections sweeping through the democratic West seem to be getting bigger and bigger, with no end in sight, while less democratic places seem better at keeping the virus at bay. Does that mean that democracy is bad for your health?
 

Watch Out: Mr. Robot is Here

Not content with just taking jobs away, robots are also giving a drubbing to the marriage prospects of male workers more exposed to robot job penetration, as new CESifo research shows. Robots are also changing fertility patterns.

 

Take me to Your Leader

Monetary incentives are often the tool of choice for companies to improve team performance and foster idea creation. But that costs money. New CESifo research has shown an equally effective approach that costs nothing.

Crime, Inequality and Subsidized Housing: Evidence from South Africa

This study is the first to establish a link between unequal housing conditions and crime in South Africa. After apartheid ended, only 65% of households lived in formal housing. Housing programs make a significant contribution to increasing equality and fighting crime.

Welfare Reforms and the Division of Parental Leave

Financial incentives influence fathers' decision on how long to take parental leave. Following the 2019 directive on Work-Life Balance, all EU member states must by 2022 provide each parent 9 weeks of paid (non-transferable) parental leave. This research paper studies how the 2019 directive can be implemented to better achieve a more equal sharing of the burden of raising children.

Informed Choices: Gender Gaps in Career Advice

Does a person's gender affect what they learn from working professionals about career options? Yes, because female students receive substantially more information on work-life balance than their male peers. Most of the time, this information is negative. As a result, women in this situation are more concerned about work-life balance and are discouraged from pursuing their preferred career path.

Working from Home: Too Much of a Good Thing?

Too much working from home reduces the performance of the overall economy because the productivity is negatively affected by over-exploitation of ICT and by the absence of face-to-face contacts. The authors recommend working from home 20%–40% of the time on average.