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The elasticity of substitution between capital and labor (σ) is usually considered a "deep parameter". This paper shows, in contrast, that σ is affected by both globalization and technology, and that different intensities in these drivers have different consequences for the OECD and the...
Persistent link: https://www.econbiz.de/10012950903
In a Walrasian labor market, the labor income share is constant under the assumptions of a Cobb-Douglas production function and perfect competition. Given the observed decline of the labor share in recent decades, this paper relaxes these assumptions, proposes a time-series calculation of the...
Persistent link: https://www.econbiz.de/10013120133
The accumulation principle suggests that complementarity between capital and labor forces the labor income share to rise in the presence of capital accumulation. The CES model estimates using data from 20 Japanese industries between 1970 and 2012 explain the same outcome but with substitutable...
Persistent link: https://www.econbiz.de/10012867988
Can the existence of positive productivity spillovers between co-workers be explained by the presence of complementarities in a firm's production function? A simple model demonstrates that this is possible when workers perform their tasks sequentially and part of individuals' pay is determined...
Persistent link: https://www.econbiz.de/10012870242
The role of capital accumulation as a driver of the labor income share requires capital and labor to be substitutes, which appears paradoxical in a world predominantly characterized by complementarity between capital and labor. This paper argues that the composition of skills in the labor force...
Persistent link: https://www.econbiz.de/10012870261
This note provides a useful property of the Allen-Uzawa partials for the translog cost function. It also suggests how the main results extend to any functional form with certain properties. The curvature of the Allen-Uzawa matrix is the same as the curvature of the Hessian matrix. Intuitively...
Persistent link: https://www.econbiz.de/10013317143
We investigate the labor market effects of immigration in Denmark, Germany and the UK, three countries which are characterized by considerable differences in labor market institutions and welfare states. Institutions such as collective bargaining, minimum wages, employment protection and...
Persistent link: https://www.econbiz.de/10013103489
It is sometimes claimed that the coverage of collective bargaining in Germany is considerably understated because of orientation, a process whereby uncovered firms profess to shadow the wages set under sectoral bargaining. Yet importantly, at a time when collective bargaining proper has been in...
Persistent link: https://www.econbiz.de/10013104661
A firm's decision to employ agency workers may be perceived as a replacement of directly employed workers or as way to curb union power, which trade unions would oppose. Alternatively, trade unions may encourage the (temporary) employment of agency workers in a firm, if they manage to bargain...
Persistent link: https://www.econbiz.de/10013155313
The paper estimates how wages respond to changes in regional unemployment using detailed Swedish micro data. The study is set in an economy with close to complete union coverage where real wages have grown continuously in all parts of the wage distribution for the past 15 years, and where the...
Persistent link: https://www.econbiz.de/10012894049