Globalisation and the decline of the labour share: a microeconomic perspective

Article


Perugini, C., Vecchi, M. and Venturini, F. 2017. Globalisation and the decline of the labour share: a microeconomic perspective. Economic Systems. 41 (4), pp. 524-536. https://doi.org/10.1016/j.ecosys.2017.08.002
TypeArticle
TitleGlobalisation and the decline of the labour share: a microeconomic perspective
AuthorsPerugini, C., Vecchi, M. and Venturini, F.
Abstract

This paper contributes to the infant literature on the determinants of the labour share at the level of individual firms and provides novel insights on the effect of firms’ patterns of internationalisation. The analysis is performed using a rich dataset, covering six EU countries (Austria, France, Germany, Hungary, Italy and Spain), and combining information from the EFIGE survey and Amadeus balance sheets. Our results show that the labour share is lower for exporting firms and for those engaged in foreign direct investments or offshoring activities. These findings are robust to an array of sensitivity tests. Our instrumental variable analysis indicates that causation goes from internationalization to changes in the labour share. Investigation into the channels of the negative impact of internationalisation shows that these effects are not related to the composition of the labour force, nor to technological factors or firm market power. The analysis for subsectors of different technological regimes is consistent with this interpretation.

LanguageEnglish
PublisherElsevier
JournalEconomic Systems
ISSN0939-3625
Publication dates
Online04 Oct 2017
Print01 Dec 2017
Publication process dates
Deposited23 Aug 2017
Accepted17 Aug 2017
Output statusPublished
Accepted author manuscript
License
Digital Object Identifier (DOI)https://doi.org/10.1016/j.ecosys.2017.08.002
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