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Losing trust when pursuing development: How automation hindered political trust in China?

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  • Lu, Wenyi
  • Zhuang, Shilong
  • Fan, Siyuan

Abstract

The side effects of automation on the economy have been discussed frequently, but little is known regarding its political consequences. This paper examines the causal effect that automation induces on political costs for the local government. By combining the national individual-level panel data of political trust with the prefecture-level robot exposure rate in China, we find that the development of automation would reduce individuals’ political trust in the Chinese local government. Furthermore, we explore the channels through which the automation process could affect political trust, namely the risk of unemployment, intensified pessimism about local government, higher downside risk, and declining organization participation. This paper provides empirical evidence for the impact of automation and the source of political legitimacy, emphasizing the crucial role of governments in coping with technological progress and making good use of endogenous creative destruction.

Suggested Citation

  • Lu, Wenyi & Zhuang, Shilong & Fan, Siyuan, 2024. "Losing trust when pursuing development: How automation hindered political trust in China?," Journal of Economic Behavior & Organization, Elsevier, vol. 218(C), pages 406-422.
    • Handle: RePEc:eee:jeborg:v:218:y:2024:i:c:p:406-422
    DOI: 10.1016/j.jebo.2023.12.025
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    More about this item

    Keywords

    Automation; Political trust; Legitimacy; Development;
    All these keywords.

    JEL classification:

    • E24 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Employment; Unemployment; Wages; Intergenerational Income Distribution; Aggregate Human Capital; Aggregate Labor Productivity
    • H77 - Public Economics - - State and Local Government; Intergovernmental Relations - - - Intergovernmental Relations; Federalism
    • J68 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Public Policy
    • O33 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Technological Change: Choices and Consequences; Diffusion Processes
    • P26 - Political Economy and Comparative Economic Systems - - Socialist and Transition Economies - - - Property Rights

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