Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/179872 
Year of Publication: 
2017
Citation: 
[Journal:] Review of Economic Perspectives [ISSN:] 1804-1663 [Volume:] 17 [Issue:] 2 [Publisher:] De Gruyter [Place:] Warsaw [Year:] 2017 [Pages:] 121-139
Publisher: 
De Gruyter, Warsaw
Abstract: 
Despite the fact that stability of labor share in national income is a key foundation in macroeconomic models, scientists acknowledge, that in the last three decades it has been declining around the world. The Baltic countries are not an exception; they follow similar patters to large economies, thus the research aims at determining economic factors at play. With the help of error correction model and time series data covering the past twenty years, we determine factors which contribute to the decline of labor share in the Baltic countries. We find significant long-term relationships between labor share and government spending, trade openness, and emigration. Government spending exhibits the highest contribution to variance of labor share in Lithuania, which also explains a large part of Latvia’s labor share variations. We find many similarities between the analyzed countries, however some differences are also visible.
Subjects: 
Baltic countries
income distribution
labor economics
labor share
JEL: 
J01
J30
E25
D33
Persistent Identifier of the first edition: 
Creative Commons License: 
cc-by-nc-nd Logo
Document Type: 
Article

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