Globalization, creative destruction, and labour share change: evidence on the determinants and mechanisms from longitudinal plant-level data
AbstractThe labour share of GDP has declined in recent decades in many leading economies. This paper examines the mechanisms of falling labour share using Finnish manufacturing plant-level data over three decades. Using a useful variant of the decomposition method, we make a distinction between the changes in the average plant and the micro-level restructuring. We show that micro-level restructuring is the link between the declining labour share and increasing productivity, and that increased international trade is a factor underlying those shifts. Copyright 2012 Oxford University Press 2011 All rights reserved, Oxford University Press.
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Bibliographic InfoArticle provided by Oxford University Press in its journal Oxford Economic Papers.
Volume (Year): 64 (2012)
Issue (Month): 2 (April)
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Other versions of this item:
- Maliranta, Mika & Böckerman, Petri, 2009. "Globalization, Creative Destruction, and Labor Share Change: Evidence on the Determinants and Mechanism from Longitudinal Plant-level Data," Discussion Papers, The Research Institute of the Finnish Economy 1178, The Research Institute of the Finnish Economy.
- F16 - International Economics - - Trade - - - Trade and Labor Market Interactions
- J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
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- Bruno Decreuse & Paul Maarek, 2011. "Can the HOS model explain changes in labor shares? A tale of trade and wage rigidities," Working Papers, HAL halshs-00551345, HAL.
- Kauhanen, Antti & Maliranta, Mika, 2012. "Micro-components of aggregate wage dynamics," ETLA Working Papers, The Research Institute of the Finnish Economy 1, The Research Institute of the Finnish Economy.
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