Onaran, Özlem ORCID: https://orcid.org/0000-0002-6345-9922 and Guschanski, Alexander ORCID: https://orcid.org/0000-0002-7818-8264 (2018) The causes of falling wage share: sectoral and firm level evidence from developed and developing countries – what have we learned? [Working Paper]

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Abstract

The last four decades have been characterised by drastic changes in the distribution of income between wages and profits in both OECD countries and emerging economies. We have recently analysed the causes of the decline in the wage share in the developed and developing countries for a project titled ‘The causes of falling wage share and prospects for growth with equality in a globalized economy’ for the Institute of New Economic Thinking, and this paper summarizes our findings. We provide evidence that changes in bargaining power, in particular the fall in union density and welfare state retrenchment, as well as financialization and offshoring lie at the core of rising income inequality between labour and capital in both developed and developing economies. We challenge the established consensus that inequality is an unavoidable outcome of technological change or globalisation, and show the importance of labour market institutions and social protection policies.

Item Type:	Working Paper
Uncontrolled Keywords:	wage share, income distribution, union density, technology, offshoring, market concentration, financialisation
Subjects:	H Social Sciences > HG Finance
Faculty / School / Research Centre / Research Group:	Faculty of Business Faculty of Business > Department of International Business & Economics Faculty of Business > Institute of Political Economy, Governance, Finance and Accountability (IPEGFA) > Greenwich Political Economy Research Centre (GPERC)
Last Modified:	04 Aug 2021 16:33
URI:	http://gala.gre.ac.uk/id/eprint/19373

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