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Title:Falling labor share and rising unemployment: long-run consequences of institutional shocks? PDF Logo
Authors:Berthold, Norbert
Fehn, Rainer
Thode, Eric
Issue Date:1999
Series/Report no.:Wirtschaftswissenschaftliche Beiträge des Lehrstuhls für Volkswirtschaftslehre, Wirtschaftsordnung und Sozialpolitik, Universität Würzburg 30
Abstract:The literature on unemployment has mostly focused on labor market issues while the impact of capital formation is largely neglected. Job-creation is often thought to be a matter of encouraging more employment on a given capital stock. In contrast, this paper explicitly deals with the long-run consequences of institutional shocks on capital formation and employment. It is shown that the usual trade off between employment and wages disappears in the long run. In line with an appropriation model, the estimated values for the long-run elasticities of substitution between capital and labor for Germany and France are substantially greater than one.
Subjects:Unemployment
Institutional Shocks
Appropriation
Elasticity of Substitution
Technical Change
JEL:E23
E24
E25
J6
O3
Document Type:Working Paper
Appears in Collections:Wirtschaftswissenschaftliche Beiträge, Lst. f. VWL, insb. Wirtschaftsordnung u. Sozialpolitik, Universität Würzburg

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