Demographic changes and the labor income share

Article dans une revue: In this article, we study the impact of demographic changes on the inequality between capital and labor incomes. More precisely, we analyze the impact of exogenous changes in both the rate of natural increase and the net migration rate on labor income as a share of total income. We estimate a structural vector autoregression (VAR) model on a panel of 18 OECD countries with annual data for 1985–2018. We find that the response of the labor income share to an exogenous change in the rate of natural increase is significantly negative a few years after the shock, whereas its response to an exogenous change in the net migration rate is significantly positive. This suggests that in addition to the factors usually introduced in the literature, demographic factors play a role in the observed variation in the labor income share.

Auteur(s)

Hippolyte d’Albis, Ekrame Boubtane, Dramane Coulibaly

Revue
  • European Economic Review
Date de publication
  • 2021
Mots-clés JEL
E20 F22 J61
Mots-clés
  • Natural increase
  • International migration
  • JEL classification E20
  • Labor income share
  • F22
  • J61 International Migration
  • Natural Increase
  • Labor Income Share
Version
  • 1
Volume
  • 131