Real wage productivity elasticity across advanced economies, 1963-1996
Scott Carter ()
Journal of Post Keynesian Economics, 2007, vol. 29, issue 4, pages 573-600
The question of a constant wage share (Bowley's Law) has long been both an empirical and theoretical point of contention between rival theories of macroeconomic (functional) distribution. This paper explores some of these theoretical debates and issues related to Bowley's Law in contextualizing a simple empirical test of the real wage productivity elasticity of a cross section of 15 advanced economies across the 34-year period from 1963 to 1996. The evidence supports the hypothesis of a structural break in functional distribution on or around 1979 when real wages exhibit productivity inelasticity and the share of wages in national income starts a downward trajectory almost across the board. This is especially striking given the wide variety of labor market institutions and conditions across the 15 advanced economies. The paper concludes by posing the question that in light of the evidence presented perhaps a possible rethinking is in order (especially vis-Ã -vis possible national union strategies) regarding Marx's predictions on the fate of the working class as capitalism progresses.
Keywords: Bowley's Law; functional income distribution; labor market institutions and conditions; wage share (search for similar items in EconPapers)
References: Add references at CitEc
Citations View citations in EconPapers (1) Track citations by RSS feed
Downloads: (external link)
Access to full text is restricted to subscribers.
This item may be available elsewhere in EconPapers: Search for items with the same title.
Export reference: BibTeX
RIS (EndNote, ProCite, RefMan)
Persistent link: /RePEc:mes:postke:v:29:y:2007:i:4:p:573-600
Access Statistics for this article
Journal of Post Keynesian Economics is currently edited by 7
More articles in Journal of Post Keynesian Economics from M.E. Sharpe, Inc.
Series data maintained by Chris Nguyen (). This e-mail address is bad, please contact .