Technological Changes, Offshoring, and the Labor Share /
Existing studies on the downward trend in the labor share of income mostly focus on changes within individual countries. I document, however, that half of the global decline in the labor share of income can be traced to the relocation of activities between countries. I develop a two-country model to...
|a Technological Changes, Offshoring, and the Labor Share /
|c Weicheng Lian.
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|a Washington, D.C. :
|b International Monetary Fund,
|c 2019.
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|a 1 online resource (57 pages)
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|a IMF Working Papers
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|a <strong>Off-Campus Access:</strong> No User ID or Password Required
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|a <strong>On-Campus Access:</strong> No User ID or Password Required
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|a Electronic access restricted to authorized BRAC University faculty, staff and students
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|a Existing studies on the downward trend in the labor share of income mostly focus on changes within individual countries. I document, however, that half of the global decline in the labor share of income can be traced to the relocation of activities between countries. I develop a two-country model to show that when the relative price of investment goods falls, production activities with a small elasticity of substitution between capital and labor tend to get offshored from high- to low-wage countries. The model provides an explanation as to why such relocation may drive the labor share down in both developed and developing economies, as well as globally.
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|a Mode of access: Internet
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|a IMF Working Papers; Working Paper ;
|v No. 2019/142
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|z Full text available on IMF
|u http://elibrary.imf.org/view/journals/001/2019/142/001.2019.issue-142-en.xml
|z IMF e-Library