{ "title": "Effects of Globalization on Labor’s Share in National Income", "publication": "IMF Working Papers, December 1, 2006", "sourceUrl": "https://www.imf.org/en/publications/wp/issues/2016/12/31/effects-of-globalization-on-labors-share-in-national-income-19244", "canonical": "https://www.imf.org/en/publications/wp/issues/2016/12/31/effects-of-globalization-on-labors-share-in-national-income-19244", "overlayPath": "/en/publications/wp/issues/2016/12/31/effects-of-globalization-on-labors-share-in-national-income-19244/index.md", "summary": "The past two decades have seen a decline in labor's share of national income in several industrial countries. This paper analyzes the role of three factors in explaining movements in labor's share--factor-biased technological progress, openness to trade, and changes in employment protection--using a", "sections": [ { "heading": "Overview and scope", "content": "- Author: Anastasia Guscina\n- Publication date: December 1, 2006\n- Publication type: IMF Working Papers, Working Paper No. 2006/294, Issue: 294, Volume: 2006\n- Pages: 33\n- DOI: https://doi.org/10.5089/9781451865547.001\n- Stock No: WPIEA2006294\n- ISBN: 9781451865547\n- ISSN: 1018-5941\n- Sample and period: panel of 18 industrial countries over 1960-2000\n- Sample split: 1985 into preglobalization/pre-IT revolution and postglobalization/post-IT revolution eras\n- Subjects: Employment, Employment protection, Labor, Labor share, National income\n- Keywords: globalization, productivity, share, WP" }, { "heading": "Research question and methodology", "content": "- Objective:\n - Analyze the role of three factors in explaining movements in labor's share of national income: factor-biased technological progress, openness to trade, and changes in employment protection.\n- Data and empirical design:\n - Panel of 18 industrial countries covering 1960-2000.\n - Sample split at 1985 to distinguish preglobalization/pre-IT revolution and postglobalization/post-IT revolution eras." }, { "heading": "Key findings", "content": "- Decline in labor's share:\n - The past two decades (relative to the paper) saw a decline in labor's share of national income in several industrial countries.\n- Drivers:\n - Results suggest the decline in labor's share during the past few decades in the OECD member countries may have been largely an equilibrium, rather than a cyclical, phenomenon.\n - The adjustment reflected the distribution of national income between labor and capital responding to capital-augmenting technological progress and a more globalized world economy.\n- Role of examined factors:\n - Factor-biased technological progress (capital-augmenting) and increased openness to trade are emphasized as central contributors.\n - Changes in employment protection are analyzed as an additional explanatory factor." }, { "heading": "Implications (analytical)", "content": "- Interpretation:\n - The shift in labor's share is interpreted as a structural adjustment to technological and globalization-driven changes, not primarily cyclical fluctuations.\n- Policy-relevant considerations:\n - Policymakers assessing labor-income dynamics should account for long-run equilibrium effects from capital-augmenting technological change and globalization when designing labor-market and social policies.\n\nSource: IMF Working Paper \"Effects of Globalization on Labor’s Share in National Income\" by Anastasia Guscina (December 1, 2006).\n\n---\n\n Content in this bundle\n\n- wp06294\n - wp06294 (Markdown version){rel=\"alternate\" type=\"text/markdown\"}\n - wp06294 (PDF){rel=\"external\" type=\"application/pdf\"}\n\n---\n\nSource: https://www.imf.org/en/publications/wp/issues/2016/12/31/effects-of-globalization-on-labors-share-in-national-income-19244" } ], "bullets": [ "[Markdown version](/en/publications/wp/issues/2016/12/31/effects-of-globalization-on-labors-share-in-national-income-19244/index.md)", "[Structured JSON version](/en/publications/wp/issues/2016/12/31/effects-of-globalization-on-labors-share-in-national-income-19244/index.json)", "[Bundle manifest](/en/publications/wp/issues/2016/12/31/effects-of-globalization-on-labors-share-in-national-income-19244/bundle-manifest.json)", "Authors: Anastasia Guscina", "Published: December 1, 2006", "Series: IMF Working Papers", "DOI: https://doi.org/10.5089/9781451865547.001", "Author: Anastasia Guscina", "Publication date: December 1, 2006", "Publication type: IMF Working Papers, Working Paper No. 2006/294, Issue: 294, Volume: 2006", "Pages: 33", "DOI: https://doi.org/10.5089/9781451865547.001", "Stock No: WPIEA2006294", "ISBN: 9781451865547", "ISSN: 1018-5941", "Sample and period: panel of 18 industrial countries over 1960-2000", "Sample split: 1985 into preglobalization/pre-IT revolution and postglobalization/post-IT revolution eras", "Subjects: Employment, Employment protection, Labor, Labor share, National income", "Keywords: globalization, productivity, share, WP", "Objective:", "Data and empirical design:", "Decline in labor's share:", "Drivers:", "Role of examined factors:", "Interpretation:", "Policy-relevant considerations:", "**_wp06294**" ], "related": [ { "title": "_wp06294", "role": "document", "sourceUrl": "https://www.imf.org/-/media/websites/imf/imported-full-text-pdf/external/pubs/ft/wp/2006/_wp06294.pdf", "summary": { "path": "/-/media/websites/imf/imported-full-text-pdf/external/pubs/ft/wp/2006/_wp06294.pdf.md", "mime": "text/markdown" }, "binary": { "path": "/-/media/websites/imf/imported-full-text-pdf/external/pubs/ft/wp/2006/_wp06294.pdf", "mime": "application/pdf" } } ], "alternates": { "markdown": "/en/publications/wp/issues/2016/12/31/effects-of-globalization-on-labors-share-in-national-income-19244/index.md", "json": "/en/publications/wp/issues/2016/12/31/effects-of-globalization-on-labors-share-in-national-income-19244/index.json", "bundleManifest": "/en/publications/wp/issues/2016/12/31/effects-of-globalization-on-labors-share-in-national-income-19244/bundle-manifest.json" }, "generatedAtUtc": "2026-09-17T12:38:17.964Z" }