Technological progress and the global decline in the manufacturing labour share
Abstract
Using manufacturing data for a panel of 86 low- , middle-, and high-income countries over the period 1963–2020, this study investigates the effects of domestic and foreign technological progress on the labour share dynamics in low- and high-tech manufacturing. We find that the increase in domestic and, in particular, foreign technological progress since approximately 1990, has reduced the labour share in high-income countries and contributed to an increase in the labour share in middle- and low-income countries. The positive effects in the low-income countries have been driven by high R&D-intensity firms. Overall, we find that estimates for the US and other high-income countries cannot be used to project the underlying drivers of labour shares in the middle- and low-income countries.
Fields of Study & Subjects
Economic and Technological Innovation
Global trade
sustainability
and social impact
Economic Growth and Productivity
Publication details
- Journal / source
- Journal of Comparative Economics
- Publisher
- Elsevier BV
- Volume
- 54
- Issue
- 2
- Pages
- 511–525
- Publication date
- 3 March 2026
- Language
- EN