Monitoring, information technology and the labor share

Dorothee Schneider

No 2011-066, SFB 649 Discussion Papers from Humboldt University Berlin, Collaborative Research Center 649: Economic Risk

Abstract: This paper assesses empirically the hypotheses by Bental and Demougin (2010) that innovations in ICT (Information and Communication Technology) reduce the labor share in OECD countries by improving the monitoring technology. In a first step, I show that data trends for the labor share, wages in effciency units, and labor in effciency units over capital can be matched by a simulation of the model of Bental and Demougin (2010). In a second approach, I confirm increasing monitoring of workers using micro data for Germany. I argue that ICT in uences labor not only through substitutability of labor with ICT and foreign work, but also through to lowering rents of workers as monitoring technology improves.

Keywords: labor shares; bargaining; monitoring (search for similar items in EconPapers)
JEL-codes: D24 E25 J30 (search for similar items in EconPapers)
Date: 2011
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Persistent link: https://EconPapers.repec.org/RePEc:zbw:sfb649:sfb649dp2011-066

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