2023-09-28 14:46:10 +00:00
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abstract: 'This paper examines whether the labour share (wage-productivity gap) is
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a major factor in the evolution of inequality and employment. To this
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end, we use annual data for the US, UK and Sweden over the past forty
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years and estimate country-specific systems of labour demand and Gini
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coefficient equations. Further to the statistical significance of our
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models, we validate their economic significance through counterfactual
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simulations. In particular, we evaluate the contributions of the labour
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share to the trajectories of inequality and employment during specific
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time intervals in the post-1990 years. We find that during the 1990s the
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cost of a one per cent increase in employment was in the range of 0.7
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per cent-0.9 per cent higher inequality in all three countries. However,
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in the 2000s, whereas the inequality-employment sensitivity ratio
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slightly fell in the US, it exceeded unity in the countries on the other
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side of the Atlantic. It obtained its highest value in the UK, where a 1
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per cent growth in employment was achieved at the expense of 1.3 per
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cent worsening in income inequality. We argue that the
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inequality-employment sensitivity ratio can be viewed as a barometer of
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socio-economic pressure, and thus the evolution of the wage-productivity
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gap and its impacts on the personal income distribution and labour
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demand deserve the attention of policy makers.'
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affiliation: 'Karanassou, M (Corresponding Author), Univ London, Sch Econ \& Finance,
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Mile End Rd, London E1 4NS, England.
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Karanassou, Marika, Univ London, Sch Econ \& Finance, London E1 4NS, England.
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Sala, Hector, Univ Autonoma Barcelona, Dept Econ Aplicada, Bellaterra 08193, Spain.'
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author: Karanassou, Marika and Sala, Hector
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author-email: 'm.karanassou@qmul.ac.uk
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hector.sala@uab.es'
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author_list:
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- family: Karanassou
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given: Marika
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- family: Sala
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given: Hector
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da: '2023-09-28'
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files: []
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issn: 0012-9984
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journal: ECONOMIC AND SOCIAL REVIEW
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keywords-plus: INCOME-DISTRIBUTION; TOP INCOMES; UNEMPLOYMENT; FINANCIALISATION
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language: English
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month: FAL
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number: '3'
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number-of-cited-references: '46'
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orcid-numbers: Sala, Hector/0000-0002-3043-2790
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pages: 343-376
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papis_id: d8713dbe0d92de712d4e9e814c2c3c1a
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ref: Karanassou2012inequalityemployment
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researcherid-numbers: Sala, Hector/K-6370-2017
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times-cited: '3'
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title: Inequality and Employment Sensitivities to the Falling Labour Share
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2023-10-01 08:15:07 +00:00
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type: article
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2023-09-28 14:46:10 +00:00
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unique-id: WOS:000314269500002
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usage-count-last-180-days: '0'
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usage-count-since-2013: '13'
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volume: '43'
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web-of-science-categories: Economics; Sociology
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year: '2012'
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