IDEAS home Printed from https://ideas.repec.org/a/taf/applec/v47y2015i14p1460-1480.html
   My bibliography  Save this article

Economic structure and factor payments

Author

Listed:
  • Kathryn G. Marshall

Abstract

There is a growing body of evidence that the labour payment share in national income varies across countries and over time, suggesting that the popular aggregate Cobb-Douglas production function may not capture income share dynamics. There remains conflicting evidence on the importance of natural resource rents among low income economies and on estimates of the rate of return to produced capital. This paper focuses on the structural differences among countries, confirming the importance of the agriculture sector in estimates of labour and land's share of factor income based on 81 countries at diverse levels of economic development in the year 2005. I find that cross-country data are best modelled by a CES production function with an elasticity of substitution of 0.8 and that many low income countries have a higher return to capital than the United States.

Suggested Citation

  • Kathryn G. Marshall, 2015. "Economic structure and factor payments," Applied Economics, Taylor & Francis Journals, vol. 47(14), pages 1460-1480, March.
    • Handle: RePEc:taf:applec:v:47:y:2015:i:14:p:1460-1480
    DOI: 10.1080/00036846.2014.997924
    as

    Download full text from publisher

    File URL: http://hdl.handle.net/10.1080/00036846.2014.997924
    Download Restriction: Access to full text is restricted to subscribers.
    File URL: https://libkey.io/10.1080/00036846.2014.997924?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Hamilton, Kirk & Clemens, Michael, 1999. "Genuine Savings Rates in Developing Countries," The World Bank Economic Review, World Bank, vol. 13(2), pages 333-356, May.
    2. Rendall, Michelle, 2013. "Structural Change in Developing Countries: Has it Decreased Gender Inequality?," World Development, Elsevier, vol. 45(C), pages 1-16.
    3. Douglas Gollin, 2002. "Getting Income Shares Right," Journal of Political Economy, University of Chicago Press, vol. 110(2), pages 458-474, April.
    4. Chong-En Bai & Chang-Tai Hsieh & Yingyi Qian, 2006. "The Return to Capital in China," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 37(2), pages 61-102.
    5. Francesco Caselli & James Feyrer, 2007. "The Marginal Product of Capital," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 122(2), pages 535-568.
    6. Orley Ashenfelter, 2012. "Comparing Real Wage Rates: Presidential Address," American Economic Review, American Economic Association, vol. 102(2), pages 617-642, April.
    7. Orley Ashenfelter, 2012. "Comparing Real Wage Rates," Working Papers 1384, Princeton University, Department of Economics, Industrial Relations Section..
    8. Priyo Asad Karim Khan, 2012. "Sector-Specific Capital, Labor Market Distortions and Cross-Country Income Differences: A Two-Sector General Equilibrium Approach," The B.E. Journal of Macroeconomics, De Gruyter, vol. 12(1), pages 1-52, March.
    9. repec:pri:indrel:dsp01t435gd01h is not listed on IDEAS
    10. Vollrath, Dietrich, 2009. "How important are dual economy effects for aggregate productivity?," Journal of Development Economics, Elsevier, vol. 88(2), pages 325-334, March.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Clemens, Michael A. & Pritchett, Lant, 2019. "The new economic case for migration restrictions: An assessment," Journal of Development Economics, Elsevier, vol. 138(C), pages 153-164.
    2. Clemens, Michael & Pritchett, Lant, 2016. "The New Case for Migration Restrictions: An Assessment," Working Paper Series rwp16-054, Harvard University, John F. Kennedy School of Government.
    3. Douglas Gollin & David Lagakos & Michael E. Waugh, 2011. "The Agricultural Productivity Gap in Developing Countries," Working Papers 11-14, New York University, Leonard N. Stern School of Business, Department of Economics.
    4. Michael A. Clemens & Claudio Montenegro & Lant Pritchett, 2016. "Bounding the Price Equivalent of Migration Barriers," Growth Lab Working Papers 67, Harvard's Growth Lab.
    5. Mello Marcelo, 2009. "Estimates of the Marginal Product of Capital, 1970-2000," The B.E. Journal of Macroeconomics, De Gruyter, vol. 9(1), pages 1-30, May.
    6. Clemens, Michael A. & Montenegro, Claudio E. & Pritchett, Lant, 2008. "The place premium : wage differences for identical workers across the US border," Policy Research Working Paper Series 4671, The World Bank.
    7. Brad Sturgill, 2009. "Cross-country Variation in Factor Shares and its Implications for Development Accounting," Working Papers 09-07, Department of Economics, Appalachian State University.
    8. Sturgill, Brad, 2014. "Back to the basics: Revisiting the development accounting methodology," Journal of Macroeconomics, Elsevier, vol. 42(C), pages 52-68.
    9. Schelkle, Thomas, 2017. "Measuring Factor Misallocation: General Methods and Evidence on the Great Recession," VfS Annual Conference 2017 (Vienna): Alternative Structures for Money and Banking 168105, Verein für Socialpolitik / German Economic Association.
    10. Thomas Schelkle, 2016. "General Methods for Measuring Factor Misallocation," Working Paper Series in Economics 87, University of Cologne, Department of Economics.
    11. Trenczek, Jan & Wacker, Konstantin M., 2023. "Human Capital Misallocation and Output per Worker Differences: Beyond Cobb-Douglas," GLO Discussion Paper Series 1331, Global Labor Organization (GLO).
    12. Dalgaard, Carl-Johan & Erickson, Lennart, 2009. "Reasonable Expectations and the First Millennium Development Goal: How Much Can Aid Achieve?," World Development, Elsevier, vol. 37(7), pages 1170-1181, July.
    13. Harald Fadinger & Pablo Fleiss, 2011. "Trade and Sectoral Productivity," Economic Journal, Royal Economic Society, vol. 121(555), pages 958-989, September.
    14. Carolina Arteaga Cabrales, 2011. "Human Capital Externalities and Growth," Revista ESPE - Ensayos sobre Política Económica, Banco de la Republica de Colombia, vol. 29(66), pages 12-47, December.
    15. Channing Arndt & Sam Jones & Finn Tarp, 2016. "What Is the Aggregate Economic Rate of Return to Foreign Aid?," The World Bank Economic Review, World Bank, vol. 30(3), pages 446-474.
    16. repec:dgr:rugggd:gd-120 is not listed on IDEAS
    17. David Kunst, 2019. "Deskilling among Manufacturing Production Workers," Tinbergen Institute Discussion Papers 19-050/VI, Tinbergen Institute, revised 30 Dec 2020.
    18. Caselli, Francesco & Ciccone, Antonio, 2011. "A note on schooling in development accounting," LSE Research Online Documents on Economics 121768, London School of Economics and Political Science, LSE Library.
    19. Garita, Gus, 2009. "How Does Financial Openness Affect Economic Growth and its Components?," MPRA Paper 20099, University Library of Munich, Germany.
    20. Channing Arndt & Sam Jones & Finn Tarp, 2016. "What Is the Aggregate Economic Rate of Return to Foreign Aid?," World Bank Economic Review, World Bank Group, vol. 30(3), pages 446-474.
    21. Mendez-Guerra, Carlos, 2014. "On the Development Gap between Latin America and East Asia: Welfare, Efficiency, and Misallocation," MPRA Paper 62588, University Library of Munich, Germany.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:taf:applec:v:47:y:2015:i:14:p:1460-1480. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Chris Longhurst (email available below). General contact details of provider: http://www.tandfonline.com/RAEC20 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.