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TRV-2026-0195Certified recordPeer-reviewed

Skill-biased technological change in the age of AI: a theoretical analysis of automation and inequality

This paper develops a general equilibrium model to analyze how artificial intelligence (AI)–driven automation reshapes productivity, labor markets, and income distribution. The model features heterogeneous workers, endogenous automation decisions, and irreversible skill investment choices, allowing a unified examination of displacement, complementarity, and skill-supply responses. Automation substitutes for labor in routine tasks, reducing demand and wages for low-skilled workers, while simultaneously enhancing…

Labor · P Space — documented harm · certified 2026-07-13 · v1 · article view · machine-readable

Current reading — problem

AI-driven automation that substitutes for routine tasks reduces demand and wages for low-skilled workers, causing absolute welfare losses for workers below a critical ability threshold and widening income inequality.

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Findings derive from a theoretical general equilibrium model rather than observed empirical outcomes.

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Truvace Impact Record TRV-2026-0195, v1: “Skill-biased technological change in the age of AI: a theoretical analysis of automation and inequality.” Truvace, 2026-07-13. /record/TRV-2026-0195 (accessed at citation time). sha256 15e49713d1317bf5…

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