We explore the suitability of the minimum wage as a policy instrument for reducing emerging income inequality created by new technologies and automation. For this, we implement a binding minimum wage in a task-based framework, in which tasks are conducted by machines, low-skill, and high-skill...

Automation transforms the labor market, increases inequality, and thus creates social costs to society. We analyze the favorite level of automation selected in a political process between low-skill and high-skill workers. The selection is implemented by a task-specific tax in a task-based...