Taichi
Yoshida

Using a small open economy overlapping generations model, this paper examines how AI can drive economic divergence across and within Asian economies. While AI adoption may promise sizable productivity gains, it could create temporary but potentially long-lasting divergence across countries. Structurally prepared advanced economies tend to adopt AI earlier and see immediate growth gains, while emerging markets and developing economies (EMDEs) face delayed adoption and initial growth headwinds from rising costs of capital. Structural reforms that boost productivity and strengthen human capital not only accelerate adoption in EMDEs but also amplify the growth gains. Within countries, AI adoption could widen inequality along multiple dimensions: across skill groups, as high-skilled workers benefit disproportionately from complementarity with the more capital-intensive technology, and across generations, as the shift of national income towards capital favours asset-rich older households relative to younger workers who rely primarily on labour income. Redistributive policies can help mitigate these distributional pressures, though they entail equity-efficiency trade-offs that vary with country-specific fiscal and demographic conditions.

This paper studies whether job satisfaction predicts job-to-job mobility and helps explain why some worers accept wage cuts when changing jobs. Using the UK Household Longitudinal Study, I interpret job satisfaction as a subjective signal of current job-match quality, capturing both pay and non-wage job value. Workers with lower job satisfaction are substantially more likely to move directly to another employer in the following year. This relationship remains after controlling for wages, hours, worker characteristics, job characteristics, year effects, and individual fixed effects. Job satisfaction falls before direct job-to-job moves and rises sharply after them. The increase is larger than among comparable non-movers with similar ini- tial satisfaction, suggesting that the pattern is not driven only by mean reversion. Finally, some direct job-to-job movers experience hourly wage cuts, but these workers still report large gains in job satisfaction after moving. The results suggest that wage changes alone do not fully summarise the value of job-to-job transitions, and that subjective job quality provides useful information about mobility and wage-amenity trade-offs.

This paper investigates the factors influencing job-to-job transitions that involve wage reductions, a phenomenon experienced by approximately one-third of job movers, challenging traditional job ladder models. Using data from Germany’s Integrated Employment Biographies (IEB), we examine the impact of three key mechanisms: the foot-in-the-door effect, where workers accept lower wages in the hope of future opportunities; non-wage amenities, such as reduced commuting distances and flexible working arrangements, which may compensate for wage cuts; and "godfather shocks," where unexpected job displacement leads workers to accept lower wages to avoid unemployment. The findings suggest limited job-to-job movers experience hourly wage cuts, but these workers still report large gains in job satisfaction evidence for the foot-in-the-door effect, with wage growth negatively associated with wage reductions. In contrast, specific non-wage amenities and job loss risk are positively correlated with accepting lower wages.