## How Has The Globalization of Labor Affected the Labor Income Share in Advanced Countries?

_IMF Working Papers, December 1, 2007_

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## Bibliographic details
- Authors: Florence Jaumotte, Irina Tytell
- Published: December 1, 2007
- Series: IMF Working Papers
- DOI: https://doi.org/10.5089/9781451868616.001

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### Overview
- Title: How Has The Globalization of Labor Affected the Labor Income Share in Advanced Countries?
- Authors: Florence Jaumotte, Irina Tytell
- Date: December 1, 2007
- Core question: Assess contributions of globalization, technological progress, and labor market policies to the decline in the labor share in advanced countries.

### Data and Methodology
- Sample: 18 advanced countries
- Period covered: 1982- 2002
- Approach: Uses a labor share equation derived from a translog revenue function to decompose effects on the labor share.
- Sector focus: Particular attention to unskilled sectors and the information and communications sectors.

### Key Findings
- Labor markets have become increasingly integrated over the last two decades, coinciding with:
  - the entry of China, India and the former Eastern bloc into the world trading system,
  - the removal of restrictions on trade and capital flows,
  - rapid technological progress.
- The share of labor in national income decreased in most advanced countries.
- Empirical results for 18 advanced countries over 1982- 2002 suggest:
  - Globalization was only one of several factors that have affected the labor share.
  - Technological progress, especially in the information and communications sectors, has had a bigger impact.
  - The impact of technological progress was particularly pronounced on the labor share in unskilled sectors.

### Subjects and Keywords
- Subject: Employment, Labor, Labor force, Labor markets, Labor share
- Keywords: product market, unemployment benefit, WP

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