In this study, we assess the importance of exports and global value chain (GVC) participation for economic growth. Using novel methods and an extensive data set, we decompose GDP growth in the Central and Eastern European countries (CEECs) to show that in a large part of the period of transition and integration with the EU, exports have played a predominant role in shaping economic growth. We also show that exports have been the major factor driving the convergence of the CEECs with their advanced counterparts. We employ panel methods to analyse the determinants of growth of exported value added and show that the major growth drivers in the analysed period of 1995–2014 are GVC participation, imports of technology and capital deepening.Jel classificationC23, F21, O33
Standard-Nutzungsbedingungen:Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden.Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen.Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, gelten abweichend von diesen Nutzungsbedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte. Abstract Based on long US time series we document a range of empirical properties of the labor's share of GDP, including its substantial medium-run swings. We explore the extent to which these empirical regularities can be explained by a calibrated micro-founded long-run economic growth model with normalized CES technology and endogenous labor-and capital-augmenting technical change driven by purposeful directed R&D investments. It is found that dynamic macroeconomic trade-offs created by arrivals of both types of new technologies may lead to prolonged swings in the labor share due to oscillatory convergence to the balanced growth path as well as stable limit cycles via Hopf bifurcations. Both predictions are broadly in line with the empirical evidence. Terms of use: Documents inKEYWORDS: Labor income share, Endogenous cycles, Factor-augmenting endogenous technical change, Technology menu, R&D, CES, Normalization. Non Technical SummaryLooking at historical data for the US, we document that there has been a hump-shaped pattern in the labor share, coupled with marked medium-term volatility and high persistence. We show that most of the variance of the labor share lies beyond business-cycle frequencies. Therefore explaining labor-share movements with the aid of business-cycle mechanisms will only take us so far. Second, though necessarily stationary, there is no compelling evidence that labor income shares are mean reverting (even in long-dated samples). One suggestive way of reconciling these two aspects is to consider that labor income shares may be better characterized as being driven by a long cycle. We pursue this idea through the lens of an endogenous growth model. We consider a non-scale model of endogenous R&D-based growth with (a) two R&D sectors, giving rise to capital as well as labor augmenting innovations augmenting the "technology menu", (b) optimal factor augmenting technology choice at the level of firms, and (c) "normalized" local and global CES production functions. In addition, by assuming that new ideas follow Weibull (rather than, say, Pareto) distributions, aggregate CES production is retained in our framework. Calibrating the model on US data, we perform numerical exercises allowing us to confirm that the interplay between endogenous growth channels indeed supports oscillatory convergence to the long-run growth path, and sometimes even to stable, self-sustaining (limit) cycles.If agents are sufficiently patient (a low discount rate) a...
Labor's share of income is a key variable in economics. It plays a leading role in analysis of (in)equality, globalization, technical change, growth theories, etc. Notwithstanding this broad application, there are many different definitions of the labor share. Understanding and synthesizing those differences is the purpose of this applied survey. Empirical measures may vary reflecting the allocation of income components that cannot be directly ascribed to capital or labor. We examine the alternative assumptions made in the literature in this regard and quantify and motivate the resulting discrepancies. Focusing (mostly) on US data, we show that different measures can have very distinct properties in terms of the observed stochastic trends, shares of short-, medium-, and long-run variation and volatilities, persistence and mean-reversion properties, and susceptibility to structural breaks. For instance, while "short-run" properties of the surveyed labor share measures are relatively consistent across all definitions (and countercyclical), their "medium-" and "long-run" trends may diverge substantially (and are procyclical). To substantiate our analysis, we document the implications of discrepancies in the empirical labor share definition for growth accounting, analyzing the effect of technology shocks, and for estimating inflation dynamics.
scite is a Brooklyn-based organization that helps researchers better discover and understand research articles through Smart Citations–citations that display the context of the citation and describe whether the article provides supporting or contrasting evidence. scite is used by students and researchers from around the world and is funded in part by the National Science Foundation and the National Institute on Drug Abuse of the National Institutes of Health.
customersupport@researchsolutions.com
10624 S. Eastern Ave., Ste. A-614
Henderson, NV 89052, USA
Copyright © 2024 scite LLC. All rights reserved.
Made with 💙 for researchers
Part of the Research Solutions Family.