 The decoupling between labour compensation and productivity in high‐income countries: Why is the nexus broken?Walter Paternesi Meloni and Antonella Stirati British Journal of Industrial Relations, 2023, vol. 61, issue 2, 425-463 Abstract: During the last decades, mature economies have tended to experience a divergence between labour compensation and productivity growth. Interpretations of this trend are still under debate. Our article aims at contributing to a sound, evidence‐based understanding. We estimate the magnitude of this decoupling for a panel of 22 high‐income economies (1970–2018) and empirically assess the role of a variety of factors. After providing evidence that casts doubt on the impact of technical change, we adopt a ‘political economy’ standpoint and focus on the structural effects on real compensation growth of several macroeconomic and institutional dimensions. Our findings indicate that labour market slack and the weakening of pro‐labour institutions have acted as important wage‐squeezing factors. A negative effect is also found for trade openness and international capital mobility, while most financialization variables are not significant. The robustness of our results is supported by a range of tests and specifications. Date: 2023 Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:bla:brjirl:v:61:y:2023:i:2:p:425-463 Ordering information: This journal article can be ordered from Access Statistics for this article British Journal of Industrial Relations is currently edited by Edmund Heery More articles in British Journal of Industrial Relations from London School of Economics Contact information at EDIRC. |
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