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The paper examines the evolution and drivers of labor force participation in European regions, focusing on the effects of trade and technology. As in the United States, rural regions within European countries saw more pronounced declines (or smaller increases) in participation than urban regions. Unlike in the United States, however, trade and technology, captured here using novel measures of initial exposures to routinization and offshoring, did not result in detachment from the workforce in European regions. Instead, regions with high initial exposures to routinization and offshoring experienced so-far larger increases in participation, likely driven by an added second worker effect.

Labor --- Demography --- Macroeconomics --- Trade and Labor Market Interactions --- Globalization: Labor --- Labor Force and Employment, Size, and Structure --- Labor Demand --- Size and Spatial Distributions of Regional Economic Activity --- Labor Standards: Labor Force Composition --- Employment --- Unemployment --- Wages --- Intergenerational Income Distribution --- Aggregate Human Capital --- Aggregate Labor Productivity --- Innovation --- Research and Development --- Technological Change --- Intellectual Property Rights: General --- Demographic Economics: General --- Economics of the Elderly --- Economics of the Handicapped --- Non-labor Market Discrimination --- Labor Economics: General --- Labour --- income economics --- Population & demography --- Technology --- general issues --- Labor force participation --- Population and demographics --- Aging --- Labor market --- Economic theory --- Population --- Population aging --- Labor economics --- United States --- General issues --- Income economics

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Evidence that the automation of routine tasks has contributed to the polarization of labor markets has been documented for many developed economies, but little is known about its incidence in developing economies. We propose a measure of the exposure to routinization—that is, the risk of the displacement of labor by information technology—and assemble several facts that link the exposure to routinization with the prospects of polarization. Drawing on exposures for about 85 countries since 1990, we establish that: (1) developing economies are significantly less exposed to routinization than their developed counterparts; (2) the initial exposure to routinization is a strong predictor of the long-run exposure; and (3) among countries with high initial exposures to routinization, polarization dynamics have been strong and subsequent exposures have fallen; while among those with low initial exposure, the globalization of trade and structural transformation have prevailed and routine exposures have risen. Although we find little evidence of polarization in developing countries thus far, with rapidly rising exposures to routinization, the risks of future labor market polarization have escalated with potentially significant consequences for productivity, growth and distribution.

Labor --- Macroeconomics --- Trade and Labor Market Interactions --- Labor Force and Employment, Size, and Structure --- Technological Change: Choices and Consequences --- Diffusion Processes --- Employment --- Unemployment --- Wages --- Intergenerational Income Distribution --- Aggregate Human Capital --- Aggregate Labor Productivity --- Demand and Supply of Labor: General --- Labor Economics: General --- Industrial Organization and Macroeconomics: Industrial Structure and Structural Change --- Industrial Price Indices --- Labour --- income economics --- Economic growth --- Labor markets --- Structural transformation --- Labor force --- Economic theory --- Labor market --- Labor economics --- Economic development --- United States --- Income economics

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The paper examines the potential effects of international migration on labor force participation in advanced economies in Europe. It documents that migration played a significant role in alleviating aging pressures on labor supply by affecting the age composition of receiving countries’ populations. However, micro-level analysis also points to differences in average educational levels, as well as differences in the effects of any given level of education on participation across migrants and natives. Difficulties related to the recognition of educational qualifications appear to be associated with smaller effects of education on the odds of participation for migrants, especially women.

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The Exposure to Routinization: Labor Market Implications for Developed and Developing Economies.

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Storm Clouds Ahead? Migration and Labor Force Participation Rates in Europe.

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