Are capital shares higher in poor countries? Evidence from Industrial Surveys

Francisco Rodríguez and Daniel Ortega ()
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Daniel Ortega: Center for Finance, Instituto de Estudios Superiores de Administración

No 2006-023, Wesleyan Economics Working Papers from Wesleyan University, Department of Economics

Abstract: This paper presents new evidence on the cross-country correlation between factor shares and per capita income. The evidence comes from UNIDO and OECD databases of industrial surveys designed to measure economic activity in the corporate manufacturing sector. We show that a statistically significant negative correlation is present in both data sets. The correlation is robust to controlling for methodological variations in the valuation, concept and definition of value added and labor income. It is also present within 3 and 4-digit industries. We argue that previous evidence on capital shares derived from national accounts statistics is consistent with the negative relation that we find on the industrial survey data.

Pages: 40 pages
Date: 2006-09
New Economics Papers: this item is included in nep-dev
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Citations: View citations in EconPapers (26)

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Persistent link: https://EconPapers.repec.org/RePEc:wes:weswpa:2006-023

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