Review of Economic Studies Vol. 89 No. 1 2022

Should Robots Be Taxed?

Joao Guerreiro¹; Sergio Rebelo²; Pedro Teles³

¹ Northwestern University · ² Northwestern University, NBER, and CEPR · ³ Banco de Portugal, Catolica-Lisbon School of Business & Economics, and CEPR

Abstract

Using a quantitative model that features technical progress in automation and endogenous skill choice, we show that, given the current U.S. tax system, a sustained fall in automation costs can lead to a massive rise in income inequality. We characterize the optimal tax system in this model. We find that it is optimal to tax robots while the current generations of routine workers, who can no longer move to non-routine occupations, are active in the labour force. Once these workers retire, optimal robot taxes are zero.

DOI

10.1093/restud/rdab019

Volume

89

Issue

1

Pages

279-311

Language

en

Sources

bibtex:phds-export.bib openalex crossref

Cite

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