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Policy Contribution

The global decline in the labour income share: is capital the answer to Germany’s current account surplus?

Analysing the major divergences between the three largest euro-area countries in terms of unit labour costs and current accounts, to the broader debate on labour income shares. Data suggests that capital and labour have been complements.

By: and Date: April 26, 2017 Topic: European Macroeconomics & Governance

This paper links the major divergences between the three largest euro-area countries in terms of unit labour costs and current accounts, to the broader debate on labour income shares. The authors show that Germany, like the United States and Japan, has experienced a significant decline in the share of national income that goes to labour. At the same time, labour shares in France and Italy have increased since the beginning of monetary union, breaking a trend that had persisted for several decades. The capital intensity of production has increased much more significantly in France and Italy, while in Germany the capital-to-GDP ratio has stagnated and the net public capital stock has fallen. Our data suggests that capital and labour have been complements.

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External Publication

Manufacturing employment, international trade, and China

The decline in manufacturing employment is often seen as a major reason for rising inequality, social tensions, and the slump of entire communities. With the rise of national populists and protectionists in recent years, the issue has become even more prominent.

By: Uri Dadush and Abdelaziz Ait Ali Topic: Global Economics & Governance Date: November 28, 2019
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Blog Post

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Blog Post

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By: Alexander Lehmann Topic: European Macroeconomics & Governance, Finance & Financial Regulation Date: November 20, 2019
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Past Event

Past Event

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Past Event

Past Event

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Opinion

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Opinion

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Opinion

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Podcast

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Blog Post

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Podcast

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Policy Contribution

With or without you: are central European countries ready for the euro?

The debate on euro adoption by central European EU countries has intensified in the last years. In this Policy Contribution the author does not review all the complex aspects of euro-area enlargement, but analyse a particularly important issue: the build-up of macroeconomic vulnerabilities and the subsequent adjustments.

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