Zsoka Koczan from IMF is presenting seminar on “UNDERSTANDING THE DOWNWARD TREND IN LABOR INCOME SHARES” on 13th April, 2017 in Seanza Hall at 4 p.m.

This chapter documents the downward trend in the global labor share of income since the early 1990’s, as well as its heterogeneity along many dimensions, using newly assembled data for a large sample of advanced and emerging and developing economies. The empirical analysis points to a dominant role of technology and global integration for this trend and cross-sectional variation, although to different degrees between advanced and emerging market economies. Technological progress, reflected in the steep decline in the relative price of investment goods, along with varying exposure to routine, automatable occupations, explain around half the overall decline in advanced economies, with a disproportionate negative impact on earnings of middle-skilled workers. In emerging markets, the labor share evolution is explained predominantly by the forces of global integration, particularly of global value chain expansions, which contributed to raising the overall capital intensity in production rather than displacing workers in these economies

Presenter: Zsoka Koczan is an Economist in the World Economic Studies Division of the Research Department at the IMF, having worked previously in the European Department. Prior to joining the IMF in 2013, she worked at the European Bank for Reconstruction and Development. She holds a Ph.D. from the University of Cambridge. Her research interests include applied microeconomics, inequality and migration.