Year: 2010
Author: Ellis, Luci, Smith, Kathryn
Applied Economics Quarterly, Vol. 56 (2010), Iss. 3 : pp. 231–255
Abstract
The profit share—the share of factor income going to capital—has trended upwards since about the mid 1980s in most developed economies. Not all of the possible explanations for this are consistent with the timing or the cross-country pattern of the data. Our preferred explanation is that technological progress has increased the rate of obsolescence of capital goods. This induces faster churn in both capital and jobs, which endogenously puts firms in a stronger bargaining position. The effect is larger where there is stronger labour and product market regulation.
JEL Classification: E25, L51
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Journal Article Details
Publisher Name: Global Science Press
Language: English
DOI: https://doi.org/10.3790/aeq.56.3.231
Applied Economics Quarterly, Vol. 56 (2010), Iss. 3 : pp. 231–255
Published online: 2010-07
AMS Subject Headings: Duncker & Humblot
Copyright: COPYRIGHT: © Global Science Press
Pages: 25
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