Will Robots Ravage the Developing World?

When the Chinese appliance maker Midea Group announced a bid for the German robotics manufacturer Kuka AG this spring, it seemed like something of an omen. Kuka makes robots that specialize in assembling goods on a factory floor -- exactly the kind of work that has lifted millions of Chinese out of poverty.

After opening up to the world in 1979, China focused on tapping its vast pool of cheap labor. From T-shirts to Christmas ornaments, Chinese manufacturers could undersell the world on most any basic product simply by drafting another migrant farmer into a factory. Investment flooded into Chinese cities. The factories got bigger, better and more advanced. Wages rose, poverty fell, and a middle class emerged and quickly expanded.