Obsolescence Rents: Teamsters, Truckers, and Impending Innovations / Costas Cavounidis, Qingyuan Chai, Kevin Lang, Raghav Malhotra.

Format:

Book

Author/Creator:

Cavounidis, Costas.

Contributor:

National Bureau of Economic Research.

Chai, Qingyuan.

Lang, Kevin.

Malhotra, Raghav.

Series:

Working Paper Series (National Bureau of Economic Research) no. w31743.

NBER working paper series no. w31743

Language:

English

Physical Description:

1 online resource: illustrations (black and white);

Place of Publication:

Cambridge, Mass. National Bureau of Economic Research 2023.

Summary:

We consider large, permanent shocks to individual occupations whose arrival date is uncertain. We are motivated by the advent of self-driving trucks, which will dramatically reduce demand for truck drivers. Using a bare-bones overlapping generations model, we examine an occupation facing obsolescence. We show that workers must be compensated to enter the occupation - receiving what we dub obsolescence rents - with fewer and older workers remaining in the occupation. We investigate the market for teamsters at the dawn of the automotive truck as an á propos parallel to truckers themselves, as self-driving trucks crest the horizon. As widespread adoption of trucks drew nearer, the number of teamsters fell, the occupation became 'grayer', and teamster wages rose, as predicted by the model.

Notes:

Print version record

September 2023.