The common assumptions that labor income share does not change over time or across countries and that factor income shares are equal to the elasticity of output with respect to factors have had important implications for economic theory. However, there are several theoretical reasons for why the...

In this study, we propose an explanation for why labor and capital shares do not seem to have a trend: an increasing trend in physical capital share is compensated by a decreasing trend in land share. Similarly, an increasing trend in human capital share is compensated by a decreasing trend in...

We consider a model of factor saving innovations and study the effects of exogenous changes in labor supply. In a biased innovations setting, as economies accumulate capital, labor becomes relatively scarce and expensive. As a consequence, incentives for la-bor saving and capital using...

We present an endogenous growth model where innovations are factor-saving and model the choice of technologies in an Overlapping Generations Model where any technology can be adopted paying a cost. Markets are competitive and marginal productivity of factors determines factor prices; therefore,...

We consider a decentralized version of the neoclassical growth model where labor share is chosen by workers to maximize their long run (permanent) wages. In this framework, if the labor share increases relative to the competitive share, workers capture a larger share of a smaller total income in...

There is a significant positive statistical connection between GDP per capita and the satisfaction rate. However, Bulgaria, being a middle income economy, is one of the saddest places on Earth. We try to identify possible reasons for this phenomenon and we put forward some policy implications....

We model conflict between two agents in which each one has two possible strategies: cease-fire or rejection of the truce. We use the concept of pre-donations, namely, a redefinition of the game in which each agent commits to transfer a share of its output to the other agent (Sertel, 1991)....

We modify the standard trade model introducing the possibility of biased technological changes. This model help to explain the falling labor shares as well as the mixed changes in skill premium in developing countries after trade liberalization takes place.

We consider a decentralized version of the neoclassical growth model where labor share is chosen by workers to maximize their long run (permanent) wages. In this framework, if the labor share increases relative to the competitive share, workers capture a larger share of a smaller total income in...

We explore the relationship between union density and labor’s shares using panel data on 35 industries, spanning the entire US economy, for the years 1983 through 2005. For the full sample, a standard deviation increase in union density (membership or coverage rates) is associated with an...