The decline in rent sharing

Brian Bell, Pawel Bukowski and Stephen Machin

LSE Research Online Documents on Economics from London School of Economics and Political Science, LSE Library

Abstract: The evolution of rent sharing is studied. Based on a panel of the top 300 publicly quoted British companies over 35 years and using excess stock market returns to patenting activity as an instrument for economic rents, the paper reports evidence of a significant fall over time in the pass-through from rents to wages. It confirms that wages do respond to firm-level shocks to economic rents, but by significantly less after 2000 than during the 1980s and 1990s. The evidence of decline is robust, corroborated with alternative instruments and industrylevel analysis for the United States and the European Union.

Keywords: Centre for Economic Performance and by the project PII; which is financially supported by the NORFACE Joint Research Programme on Dynamics of Inequality Across the Life-course; which is co-funded by the European Commission through Horizon 2020 under grant agreement No 724363 (search for similar items in EconPapers)
JEL-codes: D30 (search for similar items in EconPapers)
Pages: 34 pages
Date: 2024-07-01
New Economics Papers: this item is included in nep-ger
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Citations: View citations in EconPapers (2)

Published in Labor Economics, 1, July, 2024, 42(3), pp. 683 - 716. ISSN: 0927-5371

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Related works:
Journal Article: The Decline in Rent Sharing (2024)
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Persistent link: https://EconPapers.repec.org/RePEc:ehl:lserod:119448

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