Automation and Human Capital Adjustment

Abstract

This paper analyzes the link between automation and education by investigating the impact of the introduction of industrial robots on college enrollment in the US. We exploit exogenous variation in the adoption of robots across US local labor markets and show that for every additional robot adopted four individuals enroll in college. This result is driven by rising enrollment rates in local community colleges. We also observe a shift in graduations towards more applied fields. Finally, we show that the increase in college enrollment is primarily due to reduced opportunity costs, rather than an increase in the college wage premium.