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Analysis on the Determinants of Labor Share and Its Policy Implications
Published January 30, 2023
Publication Source: KIEP
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There has been a significant decline in the global labor share, leading to numerous studies about the cause of this drop. The labor share is used as one of the main indicators of inequality because a decrease in the labor share can lead to aggravation of income inequality. This is because low-skilled workers can be greatly affected by such a decline in the labor share and the main source of in-come for the low-income class, including the self-employed, is labor income. Among various indicators of inequality, this study analyzes the determinants of the change in labor share. Technological changes such as adoption of robots, advancements in information and communications technology (ICT) and the Fourth Industrial Revolution (4IR) are expected to change the labor market. Hence, this study analyzes the impact of technological changes on labor share and suggests policy responses.

This paper was published by KIEP. KIEP retains the copyright to this paper and invites readers to share and cite the work with attribution to both the author(s) and KIEP.