Robots everywhere. What does it mean for developing countries?

Stunning technological advances have developed that have taken place of many people. Technologies like robotics & artificial intelligence controls our work in daily basis. From all- round mobile robots in agriculture to vehicle and 3D printed building. Infact , International association of robotics estimates that next year the stock of industrial robots will grow. by more than 2,50,000 units per year. production of cars, electronics, new machinery.

Automation in developing countries

In some county, developing economies are actually ahead of richer countries. Take for example, Beijing’s driverless subway line or mobile phone-based finance in Kenya. Robots could even partially replace researchers and academics. So, this is really, really quite serious now..

Concerns of World Bank

This year World Development Report focuses on the changing nature of work. and it is not the only one, Many international agencies have recently flagged such issues relating to future of work. Context of IMF, ADB, ILO,UNCTAD,UNIDO and the world bank again.

The private sector folks at Mckinsey Global Institute the world Economic forum and pricewaterhouse. The International labour organization has gone as far as launching a Global commission on the future of work.

So, why does it matter?

Automation mean for developing countries.? East-Asian pathway to development based on Job-creating manufacturing led growth gone forever. 1.8 billions or two-thirds of the workers in developing countries need to find a job. Global Universal basic income needed as indonesian minister of finance proposed at the IMF and world bank meetings. does every developing country need to set up a ministry of automation as thailand has done.

” What’s the Developer dilemma”.? – we hear you cry ( we can dream) This is a Structural Transformation. as known as Genuine Economic Development not just the Commodity fueled growth. often leads to rising inequality, unless public policy comes in between.

In this context, automation is clearly of significance to the future of economic development. The future of work and points towards the need to develop new strategies for economic development in developing countries.

So, what did we find?

  • Automation is not just a rich country issue
  • Continuing the Simpsons and the robots theme, we have three headlines (why is it always three?).The bulk thinking on the economic implications has so far focused on advanced industrialised economies. where the cost of labour is high and manufacturing shows a high degree of mechanisation and productivity. Yet, the developing world is both affected by automation trends in high-income countries and is itself catching up in terms.

    Automation is likely to affect developing countries in different ways to high-income countries. The kinds of jobs common in developing countries—such as routine agricultural work—are substantially more susceptible to automation. than the service jobs—which require creative work or face-to-face interaction—that dominate high-income economies.

    Automation is not only about technology

    The current debate focuses too much on technological capabilities, and not enough on the economic, political, legal, and social factors. that will profoundly shape the way automation affects employment. Questions like profitability, labour regulations, unionisation, and corporate-social expectations will be at least as important as technical constraints. in determining which jobs get automated, especially in developing countries.

    Pay more attention to stagnating wages than unemployment

    In contrast to a widespread narrative of “technological unemployment”.(John Maynard Keynes), a more likely impact in the short-to-medium term at least is slow real-wage growth. in low- and medium-skilled jobs as workers face competition from automation. This will hinder poverty reduction and likely put upward pressure on national inequality, weakening the poverty-reducing power of growth. potentially placing social contracts under strain.

    How developing countries should respond in terms of public policy is a crucial question.

    In sum, Developing countries face real policy challenge because of spreaded automation. Technological change, upskilling strategy are very fast growing. Safety nets and wage subsidies may be desirable but the question remains how to finance them. Investing in labour heavy sectors like Infrastructure, construction, tourism, social services, education or health may be a way for developing countries. to manage disruptive impacts automation. Though these would imply major public investment and do not in themselves, constitute a long run strategy for economic development.

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