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The Real Income Shares of Labor, Human and Physical Capital from Micro- and Macro-Data

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  • Peter E.J. Steffen

    (Universität Hamburg (University of Hamburg))

Abstract

Micro data are used to separate the wage income of employed workers into components of basic labor and human capital. Further on the wage components of the self employed are determined taking into account their higher qualification and longer working hours. The fractions of these wage components are used to obtain the total income shares of basic labor, human and physical capital from yearly GDP calculations. This procedure provides a yearly information on the development of the factor shares for individual countries, a tool for understanding development and growth. German census data of the years 1976, 1985, 1995, and 2006 are selected in order to demonstrate the method. As result the factor shares for these years are obtained. The average shares are in agreement with the well known results of Mankiw, Romer and Weil [8] if only employed workers are considered. If self-employed labor is also taken into account, the share ratios of physical and human capital and labor change to sK : sH : sL = 0:21 : 0:25 : 0:54. This result di ers considerably from the generally expected share ratios for developed countries of 1/3 : 1/3 : 1/3. Further on, the development in time is investigated. A considerable variation is observed in the last period: 1995 - 2006. It is contradictory to a constant behavior as expected from Kaldor's stylized facts. The source could be traced to considerable changes in the qualification structure of the German work force.

Suggested Citation

  • Peter E.J. Steffen, 2013. "The Real Income Shares of Labor, Human and Physical Capital from Micro- and Macro-Data," Macroeconomics and Finance Series 201309, University of Hamburg, Department of Socioeconomics.
    • Handle: RePEc:hep:macppr:201309
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    References listed on IDEAS

    as
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    2. Jeong, Byeongju, 2002. "Measurement of human capital input across countries: a method based on the laborer's income," Journal of Development Economics, Elsevier, vol. 67(2), pages 333-349, April.
    3. Trinh Le & John Gibson & Les Oxley, 2003. "Cost‐ and Income‐based Measures of Human Capital," Journal of Economic Surveys, Wiley Blackwell, vol. 17(3), pages 271-307, July.
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    5. Mulligan, C. B. & Sala-i-Martin, X., 1997. "A labor income-based measure of the value of human capital: An application to the states of the United States," Japan and the World Economy, Elsevier, vol. 9(2), pages 159-191, May.
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    7. Giuseppe Folloni & Giorgio Vittadini, 2010. "Human Capital Measurement: A Survey," Journal of Economic Surveys, Wiley Blackwell, vol. 24(2), pages 248-279, April.
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    Cited by:

    1. Alessandro Bellocchi, 2020. "Labor share is falling down, but which one?," Working Papers 2001, University of Urbino Carlo Bo, Department of Economics, Society & Politics - Scientific Committee - L. Stefanini & G. Travaglini, revised 2020.

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    More about this item

    Keywords

    human capital; Mikrozensus; annual factor income shares; factor share development;
    All these keywords.

    JEL classification:

    • D33 - Microeconomics - - Distribution - - - Factor Income Distribution
    • E25 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Aggregate Factor Income Distribution
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity

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