Industrial automation and product quality: the role of robotic production transformation

Abstract

We investigate the impact of industrial automation, specifically robots, on product quality in international trade. By analysing detailed data from Chinese listed firms, we examine how the adoption of robots is associated with higher product quality compared to that of nonrobot users. This effect is more pronounced among heterogeneous products and in ordinary trade patterns. We identify several mechanisms through which robots contribute to product quality improvements, including resource reallocation, adaptability to complex production processes, and enhancement of input quality. Moreover, we demonstrate that replacing low-skilled labour with complex robots and employing high-skilled labour to collaborate with robots improved product quality, confirming that robotic displacement and reinstatement effects generate better product quality upgrading. Overall, our empirical evidence supports the positive influence of robot adoption on product quality and provides insights into the mechanisms underlying robotic production transformation.