Dynamic model of the relationships between technology and employment

The objective of this paper is to find a dynamic model that allows us to analyze and understand the underlying relationships between technology and employment. We will begin showing some data that illustrates the employment situation in the world and particularly in Spain, as well as its connection with other variables such as productivity, economic growth, quality of employment, the length of the workday, wage levels, and so on. We will then propose a model that allows us to characterize the link between technology and employment, or more appropriately, between technological development and employment. To show the complexity of this relationship a series of sub-models, with an increasing level of detail and precision, will be built. Various economic doctrines will be analyzed, which offer different perspectives about this issue. Then we approach the problem analytically, leading to a mathematical model of relations between technology and employment, so we can know how different magnitudes related with employment (number of employees, productivity, demand, salaries, etc.) evolve under a change in technology. Our model will allow the modification of the considered parameters, so that they can be adjusted to the realities of the economy at any given moment. Finally we perform a sensitivity analysis, which reveals very useful in the development of effective policies to increment the employment in a given economy.