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Labor share decline and intellectual property products capital

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  • Koh, Dongya; Santaeulàlia-Llopis, Raül; Zheng, Yu

Abstract

We study the behavior of the US labor share over the past 65 years. We find that intellectual property products (IPP) capital entirely accounts for the observed decline of the US labor share, which otherwise is secularly constant for structures and equipment capital. The decline of the labor share reflects that the US is undergoing a transition to a more IPP capital-intensive economy. This result has essential implications for the US macroeconomic model.

Suggested Citation

  • Koh, Dongya; Santaeulàlia-Llopis, Raül; Zheng, Yu, 2015. "Labor share decline and intellectual property products capital," Economics Working Papers ECO2015/05, European University Institute.
  • Handle: RePEc:eui:euiwps:eco2015/05
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    More about this item

    Keywords

    Labor Share; Intellectual Property Products; Capital; 1999- and 2013-BEA Revisions;
    All these keywords.

    JEL classification:

    • E01 - Macroeconomics and Monetary Economics - - General - - - Measurement and Data on National Income and Product Accounts and Wealth; Environmental Accounts
    • E22 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Investment; Capital; Intangible Capital; Capacity
    • E25 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Aggregate Factor Income Distribution

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