Micro-mechanisms Behind Declining Labour Shares: Market Power, Production Processes, and Global Competition
IWH-CompNet Discussion Papers,
This article investigates how changing production processes and increasing market power at the firm level relate to a fall in Germany’s manufacturing sector labour share. Coinciding with the fall of the labour share, I document a rise in firms’ product and labour market power. Notably, labour market power is a more relevant source of firms’ market power than product market power. Increasing product and labour market power, however, only account for 30% of the fall in the labour share. The remaining 70% are explained by a transition of firms towards less labour-intensive production activities. I study the role of final product trade in causing those secular movements. I find that rising foreign export demand contributes to a decline in the labour share by increasing labour market power within firms and by inducing a reallocation of economic activity from nonexporting- high-labour-share to exporting-low-labour-share firms
Speed Projects Here you can find the Speed Projects in chronologically descending...
DPE Faculty A B C D E F G H I J...
IWH at 2020 ASSA Annual Meeting in San Diego IWH researchers are going to present their research outputs from January 3...
Reports of the European Forecasting Network (EFN)
Reports of the European Forecasting Network (EFN) The European Forecasting...
The CompNet Competitiveness Database The Competitiveness Research Network (CompNet)...
Members & Research Doctoral Students Dmitri Bershadskyy; Doctoral thesis project: "Experimental Analysis of the Relationship between Institution Stability and...
European Firms after the Crisis – New Insights from the 5th Vintage of the CompNet Firm-level-based Database ...
IWH-CompNet Discussion Papers
IWH-CompNet Discussion Papers The IWH-CompNet Discussion Paper series presents research...