Research On Factor-biased Internet And Its Impact On Employment

Benefit from the remarkable development speed and scale of the Internet in China in less than 30 years,we have entered the era of "Internet of Everything(IOE)".There are favorable objective and subjective conditions for the rapid development of the Internet in China: a huge population and the scale of Internet users,as well as the favorable subjective policy environment.Represented by the Internet economy and digital economy,the new economic mode has become an important power trigger a new round of economic growth,particularly during the Coronavirus Disease 2019(COVID-19)Outbreak,a variety of new mode of study and work have emerged,such as network office,online teaching,which ensured China's positive economic growth during the epidemic.While Internet technology has brought huge benefits to social and economic development,it has also brought complex impacts on macroeconomic operation,especially employment.The emergence of Internet-based technologies such as big data and artificial intelligence has once again aroused the controversy on employment.As General Secretary Xi Jinping mentioned in the congratulatory letter of the 2018 World Artificial Intelligence Conference,“new issues raised by artificial intelligence in employment should be handled well”.In 2019,the Chinese government has placed "employment stability" at the top of the six macroeconomic policies,which shows the importance of the Internet's impact on employment.As the "root technology" of emerging technologies such as big data,artificial intelligence,Internet of Things,mobile Internet,etc.,the Internet's development characteristics and its complex impact on employment need to be clarified urgently.Based on the summary of the development characteristics of the Internet in China,this article will focus on measuring the development level of the Internet and its factor bias from the industry level,and explore the impact of the factor-biased Internet on the quantity and structure of employment.Clarifying the role of factor bias of the Internet in reshaping employment and employment structure will play a significant role in stabilizing employment,coping with the challenges of an “aging” society,improving factor markets and income distribution,promoting the healthy and orderly development of the Internet,and ensuring sustained economic growth.The thesis is mainly divided into five parts.In the first part,based on the combing of Internet-related policies and research literature,the author summarizes four technical characteristics of development of the Internet in China: pioneering,fundamental,innovative and diffusible,and two socio-economic characteristics: industrial and biased,which determines the perspective and direction for this research,that is,to characterize the industrial and biased Internet from the industry level.To this end,in the literature review section,this article combs the literature on the measurement of factor bias,technology spillover research,the impact of technological progress on employment and the change mechanism of factor bias,to lay the theoretical foundation for the following parts.In the second part,this paper firstly proposes the measurement method for the development level of the Internet at the industry level with the help of the input-output theory,so as to realize the comparability of the Internet development level among different industries.Secondly,based on the Internet development characteristics and related theory summarized in the first part,extended production function model is established to depict the biased Internet,from which derives the definition of Internet bias.this paper extends the method of standardization supply side system to estimate the parameters for the Internet bias.Finally,from the national and subindustry levels,this paper conducts empirical measurement and cross-comparative analysis on the Internet bias of the total Internet from China and imported as well as the Internet bias of hardware and software.The third part explores the impact of Internet bias on employment from both theoretical mechanisms and empirical analysis.In the theoretical mechanism analysis,the bias of the Internet will directly affect the labor input through the production efficiency of factors on one hand;it will affect the input of labor relative to capital through the deepening of capital on the other hand.In the empirical analysis,this paper takes the spillover effect of Internet bias between industries into account,embeds the spatial econometrics method into the inter-industry,and uses two industry weight matrices derived from the direct consumption coefficient matrix to measure the correlation between industries.Spatial Durbin Model(SDM)is used to quantitatively analyze the impact of Internet development level,Internet bias and its industry spillover effect on employment,and to clarify the impact of the Internet's participation in the production process on the input of labor factors.In the fourth part,regarding the industry structure of employment as a compositional data,we explore the influence of Internet bias and industry spillovers on the distribution of labor among industries by combining compositional data analysis methods with partial least squares methods,which reveals the role of Internet bias in reshaping the employment structure from the perspective of systemic changes.Going back to the Internet bias itself,the fifth part analyze the linear and nonlinear effects of various factors on Internet,especially the industry spillover effect of Internet bias and the development level of Internet,by using spatial econometrics models.Combining with the previous conclusions about the impact of Internet bias on total employment and employment structure,we put forward a series of policy recommendations for regulating and guiding the healthy development of the Internet from the perspective of stable employment,in order to promote the benign interaction of the Internet,the employment structure,and the economic growth.The main conclusions of this article are as follows: first,(1)Compared domestic and imported Internet,it is found that China's domestic Internet development level is much higher than the imported,which means that the capacity for independent innovation of China is improving.Imported Internet is more vulnerable to economic fluctuations such as financial crises.(2)Compared Internet software and hardware,it is found that whether it is domestic or imported,Internet hardware development level is higher than software.(3)The level of Internet development in technology-intensive manufacturing is the highest among all industries,and it shows a strong dependence on Internet hardware intermediate products.Second,(1)the overall domestic and imported Internet in China are capital-biased,but the bias degree of domestic Internet is always very small,and the capital-biased characteristics of imported Internet become more and more obvious in the later period of the sample.(2)Domestic Internet hardware is significantly capital-biased,however,imported Internet hardware is significantly labor-biased,the factor biases of these two are weakened year by year.(3)The factor bias of domestic and imported Internet software has the same performance as the overall bias of the Internet,and the element bias of Internet software has a greater impact on the overall bias of the Internet.(4)Domestic Internet bias is highly heterogeneous in different industries,while imported Internet bias is homogenous.Third,(1)the factor bias of Internet has spillover effect between industries.(2)During the sample period,biased-Internet mainly affects industry employment through factor productivity mechanisms,which includes three main paths namely labor bias effects and capital bias effects within the industry,employment spillover between industries,and the spillover between industries of labor bias effects and capital bias effects.The labor bias effects within industry will "crowd out" employment,while the capital bias effects within industry will "create" employment.The employment spillover between industries is not conducive to employment in this industry.The influence of the spillover between industries of labor bias effects and capital bias effects is heterogeneous between different sources of the Internet and different industry weight matrices.Fourth,biased Internet has a significant impact on the shaping of the employment structure.(1)From the perspective of within industry,the Internet capital bias effect mainly explains the change in the proportion of employment in the primary and secondary industries,while the Internet labor bias effect mainly explains changes in the proportion of employment in the tertiary industry,Internet development level mainly explains the changes in the proportion of employment in the primary and secondary industries.(2)From the perspective of inter-industry,the spillover of Internet capital bias effect mainly explains the change in the employment share of the tertiary industry,while the spillover of Internet labor bias effect mainly explains the change in the employment share of the primary and secondary industries.(3)The upgrading of industrial structure and demographic structure has promoted the upgrading of employment structure;the Internet has an obvious role in reshaping the employment structure,especially the factor bias of the Internet,which promotes the flow of labor between industries and accelerates the upgrading of the employment structure.Fifth,(1)from the perspective of within industry,the influence of Internet on the factor bias of Internet is "U"-shaped that at the beginning of the Internet using,the employment will be damaged,but with the increase of the Internet input,this damaging effect will gradually weaken,when the Internet input exceeds the threshold,it will promote employment.The relative price of factors and the level of added value also have a U-shaped nonlinear influence on the Internet bias.(2)However,from the perspective of inter-industry,the influence of Internet spillover between industries on the factor bias of Internet is inverted "U"-shaped,that is,when the Internet development level of industries that have a close direct consumption relationship with the industry exceeds the threshold,employment in the industry will be inhibited.(3)The larger the relative distortion value of factor prices is,the more likely the Internet is labor-biased,which means that the relative distortion of factor prices is not conducive to employment considering the conclusion of the third part.The main innovations of this article lie in:(1)We extend the CES production function to describe the development characteristics of Internet,and propose the theoretical definition of Internet factor bias based on the factor bias research,which provide feasible ideas for studying the factor bias of specific objects,enriching and developing the theoretical research of factor bias.Besides,this research reveals the evolution of the bias of Internet between different factors in the integration development of Internet and various industries in China through the comparative analysis of factor bias of different sources and different categories of Internet,which enriches the empirical research results of Internet factor bias.(2)By using the direct consumption coefficient matrix to describe the correlation between industries,the spatial econometric method is embedded into the inter-industry to study the spillover effect of the Internet factor bias at the industry level.Based on such spillover effect of Internet factor bias,this paper comprehensively explores the influencing factors of Internet bias and its impact on employment,which expands the application fields of spatial econometric methods,and enriches the research methods and results of factor bias.(3)This paper investigates the influence of Internet factor bias on the systemic changes in the employment industry structure by using compositional data analysis methods,which enriches the application scenarios of the combination of compositional data analysis methods and practical social problems,and reveals the reshaping effect of the Internet factor bias on the distribution of labor between industries.The Internet has penetrated all aspects of social development,production,and has completely changed people's life and thinking.The Internet is a pioneering technology and the "root technology" of many emerging technologies like Big Data,Artificial Intelligence,and Internet of Things.The integration of Internet with various industries has given birth to some new economic forms such as the Internet economy and the digital economy.Employment is the foundation of people's livelihood,the most important way to obtain the remuneration of labor through primary distribution,the first of the "six stability",and has a very important position for the smooth operation of the macro economy.In the process of the extensive participation of the Internet in industrial production,there will be factor bias,and such factor bias of the Internet will also have industry spillover and industry heterogeneity.Such spillover and heterogeneity will promote the flow of labor among industries and contribute to the advancement of the employment industry structure.The development level of the Internet will first destroy employment,and then turn to promote employment.From the perspective of ensuring and stabilizing employment,various industries should increase the input of the Internet.In the long run,the tolerance of the "pain" brought by the Internet to employment will eventually usher in the symbiosis between the development of the Internet and stable employment.In this process,we need to pay more attention to the transfer of "redundant" labor and guide the healthy flow of labor between industries.