Kohler, K orcid.org/0000-0002-6876-0538, Guschanski, A and Stockhammer, E (2019) The impact of financialisation on the wage share: A theoretical clarification and empirical test. Cambridge Journal of Economics, 43 (4). pp. 937-974. ISSN 0309-166X
Abstract
It is frequently asserted that financialisation has contributed to the decline in the wage share. This paper provides a theoretical clarification and a systematic empirical investigation. We identify four channels through which financialisation can affect the wage share: (i) enhanced exit options of firms; (ii) rising price mark-ups due to financial overhead costs for businesses; (iii) increased competition on capital markets and (iv) the role of household debt in increasing workers’ financial vulnerability and undermining their class consciousness. The paper compiles a comprehensive set of empirical measures of financialisation and uses it to test these hypotheses with a panel regression of 14 advanced countries over the 1992–2014 period. We find strong evidence for negative effects of financial liberalisation and financial payments of non-financial corporations on the wage share, which are in the same order of magnitude as the effects of globalisation.
Metadata
Item Type: | Article |
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Authors/Creators: |
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Copyright, Publisher and Additional Information: | © The Author(s) 2019. Published by Oxford University Press on behalf of the Cambridge Political Economy Society. All rights reserved. This is an author produced version of an article published in Cambridge Journal of Economics. Uploaded in accordance with the publisher's self-archiving policy. |
Dates: |
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Institution: | The University of Leeds |
Academic Units: | The University of Leeds > Faculty of Business (Leeds) > Economics Division (LUBS) (Leeds) |
Depositing User: | Symplectic Publications |
Date Deposited: | 15 Sep 2021 10:47 |
Last Modified: | 29 Sep 2021 02:06 |
Status: | Published |
Publisher: | Oxford University Press |
Identification Number: | 10.1093/cje/bez021 |
Open Archives Initiative ID (OAI ID): | oai:eprints.whiterose.ac.uk:178198 |