Globalization, Creative Destruction, and Labor Share Change: Evidence on the Determinants and Mechanism from Longitudinal Plant-level Data

Mika Maliranta and Petri Böckerman ()

No 1178, Discussion Papers from The Research Institute of the Finnish Economy

Abstract: We examine the sources and micro-level mechanisms of the changes in the labor share of value added. We link the micro-level dynamics of the labor share change with that of productivity and wage growth. Using a useful variant of the decomposition method we make a distinction between the change in the average plant and the micro-level restructuring. With Finnish plant-level data covering three decades we show that micro-level restructuring is the link between the declining labor share and increasing productivity in 12 manufacturing industries of four regions, and that increased international trade is a factor underlying those shifts.

Keywords: globalization; international trade; foreign ownership; micro-level restructuring; labor share (search for similar items in EconPapers)
JEL-codes: F16 J31 (search for similar items in EconPapers)
Pages: 34 pages
Date: 2009
New Economics Papers: this item is included in nep-bec and nep-lab
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Citations: View citations in EconPapers (1)

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Related works:
Journal Article: Globalization, creative destruction, and labour share change: evidence on the determinants and mechanisms from longitudinal plant-level data (2012)
Working Paper: Globalization, creative destruction, and labor share change: Evidence on the determinants and mechanisms from longitudinal plant-level data (2009)
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