00000nam 2200000za 4500 9.867631 CaOODSP 20221107162351 cr ||||||||||| 190125s2019 onc #o f|0| 0 eng d CaOODSP eng eng fre n-cn--- FB3-5/2019-3E-PDF Glover, Andrew. Can capital deepening explain the global decline in labor’s share? [electronic resource] / by Andrew Glover and Jacob Short. [Ottawa] : Bank of Canada, 2019. ii, 45 p. Bank of Canada staff working paper, 1701-9397 ; 2019-3 "January 2019." Includes bibliographic references. "We estimate an aggregate elasticity of substitution between capital and labor near or below one, which implies that capital deepening cannot explain the global decline in labor's share. Our methodology derives from transition paths in the neo-classical growth model. The elasticity of substitution is identified from the cross-country correlation between trends in the labor share and (a proxy for) the rental rate of capital. Trends in labor's share and the rental rate are weakly correlated across countries, and inversely related in most samples. Previous cross-country estimates of this elasticity were substantially greater than one, which we show was partly due to omitted variable bias: earlier studies used investment prices alone to proxy for the rental rate, whereas the growth model relates rental rates to investment prices and consumption growth"--Abstract. Includes abstract in French. gccst Labour market gccst Capital Short, Jacob. Bank of Canada. Staff working paper (Bank of Canada) 1701-9397 ; 2019-3. (CaOODSP)9.806221 PDF 1.37 MB https://publications.gc.ca/collections/collection_2019/banque-bank-canada/FB3-5-2019-3-eng.pdf