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How Has The Globalization of Labor Affected the Labor Income Share in Advanced Countries?
Author: Ms. Florence Jaumotte and Ms. Irina Tytell
Series:
IMF Working Papers
Volume/Issue:
Volume 2007: Issue 298
Language:
English
Publication Date:
01 Dec 2007
DOI:
https://0-doi-org.library.svsu.edu/10.5089/9781451868616.001
ISBN:
9781451868616
ISSN:
1018-5941
Pages:
54
Keywords:
WP; product market; unemployment benefit
Legal-disclaimer:
IMF Working Papers describe research in progress by the author(s) and are published to elicit comments and to encourage debate. The views expressed in IMF Working Papers are those of the author(s) and do not necessarily represent the views of the IMF, its Executive Board, or IMF management.
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Labor markets around the world have become increasingly integrated over the last two decades, with the entry of China, India and the former Eastern bloc into the world trading system, the removal of restrictions on trade and capital flows, and rapid technological progress. At the same time, the share of labor in national income decreased in most advanced countries. This paper uses a labor share equation derived from a translog revenue function to estimate the contributions of globalization, technological progress, and labor market policies to the decline in the labor share. The results, obtained for 18 advanced countries over 1982- 2002, suggest that globalization was only one of several factors that have affected the labor share. Technological progress, especially in the information and communications sectors, has had a bigger impact, particularly on the labor share in unskilled sectors.
Cover IMF Working Papers
IMF Working Papers
ISSN:
1018-5941
Publisher:
International Monetary Fund