Share Of National Income Research Articles

Evaluation of Livestock Enterprises in terms of Farmer Satisfaction and Current Situation

In addition to meeting the basic needs and nutritional needs of people, the agricultural sector is of vital importance for countries due to many factors such as its place in employment, the supply of raw materials to the industrial sector and the use of the products produced as inputs, and its share in national income. The agricultural sector needs to be supported due to its unique characteristics and the importance of the sector. Although economic factors come to the fore on the sustainability of agricultural enterprises, the current situation and satisfaction of the enterprises also have an important place. In this study, the current situation and satisfaction of livestock enterprises are evaluated. The research was conducted in Seben District of Bolu Province small ruminant breeding as well as small ruminant breeding enterprises agricultural enterprises. In determining the enterprises, fullcensus method was used. Complete census method was used to determine the enterprises. Face-to-face questionnaire application was used to collect the data and SPSS package program was used to analyze the data obtained. As a result of the study, it was concluded that 74.4% of the enterprises were not satisfied with the situation and future of their agricultural enterprises, and they wanted their children to turn to different sectors and not to continue in the agricultural sector. In addition, producers stated that agricultural supports are important for the continuity of production and sustainability of enterprises (62.8%), and that they take agricultural supports into consideration in their production planning.

Fumio Kishida’s first year in PM office: Is Abenomics to end or stay?

The article addresses the experience of Fumio Kishida’s first year as Prime Minister of the Japanese government with respect to its economic policy vision and implementation. The latter is presented by comparing it to the policy pursued over the past ten years by PM Kishida’s predecessors in the office, on the one hand, and to the commitments he announced during the 2021 election campaign, on the other. The paper notes that, in its basic moments, the economic policy of the cabinet of the new leader of the ruling Liberal Democratic Party continues the course previously maintained by the team of then-PM Shinzō Abe, known as Abenomics. This manifests itself in the specifics of the use of basic tools of macroeconomic policy, monetary and tax instruments to be named first, as well as in choosing priorities for the policy stimulating consumption and economic activity. The continuity of the course can be particularly illustrated by loose monetary policy; positive view of the depreciation of Japanese national currency; moderately expansionary fiscal policy relying on domestic borrowing; preference given to the interests of the corporate sector. Legacy inherited from previous administrations also includes the government striving to revitalize private demand; promoting investment in R&D, venture and innovating enterprises with particular stress on regional economies. Kishida’s particular emphasis on invigorating redistributive mechanisms and increasing labor share in national income has not yet led to material decisions and actions by the government. Nor did Kishida make progress with his commitment to expand the ring of beneficiaries of the capitalist market system, as part of his idea of “new capitalism”.In recent months, the attention of the government and its economic team has been largely focused on overcoming the consequences of the disruption of transnational chain lines in production, trade, and logistics, as a result of the coronavirus pandemic and rising geopolitical tensions. In addressing this issue, they prioritized subsidizing businesses and households to partially offset energy and food price hikes; securing diversification or localization of critical links of trade and production chains, as well as the exclusion of politically undesirable or unstable locations from them. At this stage, however, the actions of the government are limited to setting relevant goals and plans to provide finance for programs with effectiveness yet to be proved.

Natural Capital, Institutional Quality and SDG Progress in Emerging Market and Developing Economies

Whether environmental impacts, natural capital depreciation, and effective governance have impacted progress in emerging market and developing economies (EMDEs) to achieving the 17 Sustainable Development Goals (SDGs) of the UN Agenda 2030 has become a significant policy topic. We determine estimates of the changes in net welfare that indicate progress over 2000–2019 in terms of meeting the 17 SDGs for 99 EMDEs. We compare these estimates with the environmental impacts associated with SDGs 11–15, natural resource depletion as a share of national income, and average institutional quality. Net SDG welfare gains over 2000–2019 were often accompanied by adverse environmental impacts, natural capital depletion, and poor-quality institutions. This is especially the case for low- and lower-middle-income economies. Higher net SDG welfare gains are correlated with reduced losses associated with SDGS 11–15, and larger welfare gains from attaining SDG 1 No Poverty are associated with better governance. These results suggest that long-term progress towards the SDGs in EMDEs hinges on improved management of natural capital and the environment, as well as more effective governance. Three policies can be implemented to achieve these objectives without additional financing or imposing fiscal burdens: fossil fuel subsidy swaps, tropical carbon taxes, and improved management and distribution of resource revenues.

AN ECONOMIC STUDY TO MEASURE INFLUENCE OF THE MAIN VARIABLES IN RURAL POVERTY IN IRAQ DURING 1990 – 2019

The research aims to measure influences of the main variables in rural poverty in Iraq during 1990 – 2019, so it used descriptive and qualitative methods to show the subject. The research reaches throw results of unit root test that all the variables were un stable in the level, but all of them were stabled after first difference. The research proved it`s hypothesis that all structural changes can lead to reduce the rural poverty in Iraq, the study explained positive relationship among the dependent variable ( per capita of national income) and independent variables ( rural population, agricultural labor, planted area of crops and the using technology), where increase by 1 % in each of the independent variables lead to increase in share of national income by ( 1.02, 3.6, 0.19,0.55) % respectively, this study showed there are decreasing in ratio of agri. product in GDP during the study period between % 20.4 .4 1995 and % 2.4 in 2018 and that indicated dependency of Iraq in crude oil and don’t have care with agricultural sector. The research recommends to planning of development strategy in Iraq`s countryside to reduce rural poverty and support the agri. Sector by modern technology.

Türkiye’de Ücret Politikaları ve Gelir Dağılımı Eşitsizliği İlişkisi

Gelir dağılımındaki eşitsizlikle mücadelede önemli stratejilerden biri, emek faktörünün gelirini artırmaya yönelik ücret politikalarıdır. Zira ücret, milli gelirde en büyük paya sahip faktör geliridir. Bu bağlamda çalışmada, Türkiye’de ücret politikalarının gelir dağılımı eşitsizliğini nasıl etkilediği irdelenmektedir. ARDL Sınır Testi Yaklaşımı ile analiz edilen ekonometrik modelin bağımlı değişkeni gelir dağılımını temsilen Gini katsayısı, bağımsız değişkenleri ise özel sektör ücretlerini temsilen özel bir havayolu şirketinin ortalama ücretleri ve asgari ücrettir. Çalışmanın bulgularına göre asgari ücretteki %1’lik bir artış Gini katsayısını %0.061 oranında azaltmakta; özel sektör ücretlerindeki %1’lik bir artış ise Gini katsayısını %0.051 oranında artırmaktadır. Bu sonuç asgari ücret politikalarının eşitsizliği azaltmada önemli rol oynadığını; özel sektör ücret artışlarının ise eşitsizliği artırdığını ima etmektedir. Ayrıca nedensellik analizine göre bu ilişki kısa dönemde de geçerlidir.

Analysis of Output and Employment of Trade and Finance in India: A Case of Disproportional Rise in Output than Employment for Service Sector

Purpose of the study: The study aims to analyse why the service sector in India has not generated employment in the proportion of output when the sector has geared up its share in national income since 1980.
 Methodology: It's based on a simple comparative empirical analysis of data on output and employment of trade and finance in India. Quantitative analysis of output is based on data collected from National Accounts Statistics (NAS). The analysis used data from the base year 2004-05 and back series. On the 2004-05 back series, data is available till the year 2011-12. Therefore, to explain long periods, 1950 to 2012, we used 2004-05 data. However, for the latest analysis of output along with employment, we prefer to use the 2011-12 series GDP data of KLEMS India (published by RBI).
 Employment data is collected primarily from two sources- NSS and KLEMS India. Principal status and subsidiary status (PS+SS) are used for analysis. 
 Main Findings: Trade being a labour-intensive sector has shown proportionate employment generation between 1980 to 2004. After 2004, the story changed. Despite the same pace of growth, employment generation is proportionately lower. The reason is the growing rise in the capital intensity of trade. In the case of finance, capital-intensive is just the opposite of trade- the rise in output is greater in the period, 1980 to 2004 than the concomitant rise in employment. 2004 onwards, rise in employment is greater. The reason is no significant rise in capital intensity in the sector.
 Applications of the study:In macroeconomics, output and employment believed to go hand in hand. However, services defy the dictum- higher rise in GDP share but no corresponding rise in employment share. It helps understand ‘jobless growth’ of Indian economy after reforms of 1991.
 Novelty/Originality of the study: Trade being labour-intensive has changed its nature after 2004, the sector’s capital intensity has grown faster than finance. Further, finance is capital-intensive sector but no significant rise in capital intensity.

Democracy, Labor’s Share of Income, and Labor Supply: A Time-Series Cross-Sectional Analysis

This paper examines democracy’s impact on the labor share of income: the share of Gross Domestic Product (GDP) dedicated to wages, salaries, and benefits. I hypothesize democratic regimes afford labor the opportunity to increase its share of national income. While previous empirical work finds cross-sectional evidence for the hypothesis, this paper employs a time-series cross-sectional analysis using data for 119 countries between 1950 and 2017, indicating the labor share of income is higher in democratic countries. The estimates are robust to different specifications of the statistical model. This paper also examines a potential causal mechanism that links democracy to a higher labor share through the supply of labor (the average number of hours worked in the economy). The relationship between democracy and the supply of labor lends additional evidence to my hypothesis. In a world characterized by diverging democracy, the results imply the path countries choose between democracy and dictatorship matters.

Declining Labour Income Share and Personal Income Inequality in Advanced Countries

Growing income inequality currently poses a significant threat to sustainable development. Hence, it is important to monitor this phenomenon, in particular to identify determinants favouring the deepening of income inequality. One of the significant determinants in this respect is the declining labour income share in national income. The theoretical justification of the presumption of a negative relationship between the share of labour in the national income and income inequality has strong logical foundations. Existing studies indicate, however, some ambiguities as to the strength of this relationship and the existence of various factors cancelling this relationship. The following study attempts to verify the existence, direction, and intensity of the relationship between the labour income share and income inequality in a relatively homogeneous group of 33 OECD countries studied in 1990–2018. The main hypothesis verified in the study is the assumption that there is a negative relationship between labour share and income inequality. Our results show that the relationship between the share of employees’ and self-employed workers’ income in the national income and income inequality at the general level (i.e., in a group study of 33 countries in total) exists, is negative and statistically significant, but has a very small share in explaining the behaviour of income inequality.

Macroeconomic Impacts of Declining Wage Share in National Income

The study aims to lay down a parsimonious and tractable stock-flow-consistent macroeconomic modelling approach to enhance the analysis of identification and investigation of the key underlying causes of the macroeconomic and financial instability in the context of the 2007–2008 Global Financial Crises (GFC) and COVID-19 pandemic. The model has the following key features. First, the assets and liabilities of the four major sectors, households, firms, commercial banks and government, are explicitly formalised by considering the accounting flow of the fund approach. Second, the behaviour of each sector has been derived and analysed based on accounting identities derived from the transaction flow matrix. Third, the model is calibrated and simulated by determining the values of the parameters and the exogenous variables based on the US macroeconomic data. Fourth, the most relevant simulation experiments and their results have been sufficiently analysed to produce forecasts and provide specific policy recommendations. The findings suggest that a decline in the wage share in the national income was seen to have undermined financial and macroeconomic stability in the US (and elsewhere). The results concur with the experience of current economic crises that are associated with the impact of COVID-19.

The Elusive Explanation for the Declining Labor Share

A vast literature seeks to measure and explain the apparent decline in the labor share in national income that has occurred in recent times in the United States and elsewhere. The culprits include technological change, increased globalization and the rise of China, the enhanced exercise of market power by large firms in concentrated product markets, the decline in unionization rates and the erosion in the bargaining power of workers in labor markets, and the changing composition of the workforce due to a slowdown in population growth and a rise in educational attaintment. We review this literature, with special emphasis on the pitfalls associated with using cross-sectional data to assess this phenomenon and the reasons why the body of papers collectively explains the phenomenon many times over.

Germany’s Economic Growth In 1950–60 and the Problem of the Country’s Balance of Payments Sustainability

The 1950s in Germany, especially the period 1953–1958, were later recognised as the ‘golden years of the post-war period’. By the end of this period, most of the war damage had been removed and the economy was in a state of dynamic growth. In the period 1949–59, the average real GDP growth rate was about 7.4% with an average investment rate of 24.2% (in current prices). In the years (1950–53), a massive housing construction programme was carried out that was financed almost in half from public funds. Germany’s economic growth in 1950–60 mainly influenced by investment activities and the growth of exports. During this period, state expenditure did not play a major role in the growth of the West German economy (its share in national income steadily declined during the period in question). A the same time, the share of exports in national income was very high and showed a continuously increasing trend. A long-term growth of exports — affecting constantly the expansion of demand — became an important factor stimulating investment activity, which is the main lever of economic growth. At the same time, unusually strong export activity improved the balance of payments, which showed systematic surpluses. It should also be stressed that private consumption was not a factor driving economic prosperity in West Germany in this period. The share of consumption in Germany’s national income showed a declining trend in favour of investment.

The distributive impacts of the Belt and Road Initiative

AbstractThe mission of the Belt and Road Initiative (BRI) is to achieve shared prosperity through cross‐border trade, investment flows, connectivity, people bond, and policy coordination. This motivates us to explore and evaluate the distributive effects of trade and investments under the BRI, as it offers a quasi‐natural experiment for impact evaluation by taking the BRI economies as the treatment group and other countries as the control group. Estimation results show that the BRI has generated benign distributive impacts, as the Gini estimates in BRI economies are significantly reduced after the implementation of the BRI. Further, the benign distributive impacts are found to come from imports from China. More specifically, imports from China that are complementary to local labor inputs are positively correlated with labor participation, thereby helping raise the labor share in national income and reduce income inequality. Conversely, imports of machinery, agricultural products, minerals, and so on from China are found to be negatively correlated with the GDP share of the primary industry. In other words, they help promote industrialization and urbanization in BRI economies, which are expected to lead to better income distribution in the long run.

Endogenous Education and Long-Run Factor Shares

We study the determinants of factor shares in a neoclassical environment with capital-skill complementarity and endogenous education. In this environment estimates of the elasticity of substitution between capital and labor that fail to account for human capital levels will be biased upward. We develop a model with overlapping generations, technology-driven neoclassical growth, and ongoing increases in educational attainment. For a class of production functions featuring capital-skill complementarity, a balanced growth path exists and is characterized by an inverse relationship between the rates of capital-and labor-augmenting technological progress and the capital share in national income. (JEL D33, E25, J24, O33)

Controversial effects of public debt on wage share: the case of the eurozone

ABSTRACT The aim of the paper is to estimate the effects of increasing debt burden on the wage share of national income in the eurozone from 1999 to 2019 in an attempt to verify, through a dynamic panel data cointegrating technique, whether an increase in debt implies a redistribution of resources from workers to non-wage incomes. To deepen this analysis, the empirical investigation also distinguishes between change in primary public balance and interest payments to evaluate separately the effects of the two components of public debt on wages. The outcomes are consistent with a negative relationship between public debt as a whole and the wage share. However, when accounting for the two debt components, opposite results are registered as the debt service is negatively connected, while change in primary public deficit is positively connected with the wage share of national GDP. These results allow reflecting on the interaction between the monetary policy strategy and the national fiscal policies in the eurozone.

Capital-labor substitution elasticity: A simulated method of moments approach

The elasticity of substitution between capital and labor plays an important role in the analysis of economic and policy issues such as factors' share in national income and tax policies on business capital formation. Rather than focusing on long-run relationships to estimate this elasticity, I exploit the short-run variations in the labor income share due to changes in capital-embodied technology. Using the simulated method of moments approach, I obtain an elasticity estimate that is clearly less than one. The study indicates that estimates based on the long-run relationship of factor's share may tend to be significantly larger.

The Height of Inequality: A Policy Perspective

Income households’ share of national income has grown dramatically since 1970 while the bottom 80 percent has seen their share decline. This paper examines economic, social, and demographic changes that almost assure that the income would be increasingly concentrated at the top. Occupations that dominate the top 1 percent of households nevertheless are getting unearned rents because corporate boards do not control executive compensation, medical, dental and law professions undermine competition, and a long-standing finance premium has favored that occupation. Progressivity of the tax code stops at an income level far below the $1.66 million average income for the top 1 percent of taxpayers. Higher taxes on top incomes can make the system fairer and the increased revenues can be devoted to programs that enhance economic growth and benefit lower income households.

COMMENTARY: PROPOSALS FOR A NEW FISCAL FRAMEWORK

[...]in the post-election 2015 Summer Budget, Chancellor Osborne announced a Charter for Budgetary Responsibility (HM Treasury, 2015). First of all, the political and economic cycle simply do not coincide, so tying fiscal policy to a Parliamentary term is doomed to failure. 2. [...]business cycles, like unhappy families, are each different in their own way. [...]there is no satisfactory definition of the objective of fiscal policy that meets a social welfare objective;at times, the appropriate response might mean increases or decreases in public debt as a share of national income.

Market Power, Productivity and Distribution of Wages: Theory and Evidence With Micro Data

The declining labor share in national income and rising inequality over the last four decades raise questions about causes of these trends. In order to explain these trends, we develop theoretical model that links intra-industry distribution of wages to variation in market power of firms. The model predicts that wages depend crucially on the demand side characteristics – they decline with market power if and only if demand elasticity is increasing with firm’s output. Trade liberalization leads to expansion of more productive firms, which also increases their bargaining power, resulting in lower share of wage bill in total revenue. The model predictions are tested on a sample of Ukrainian manufacturing firms in 2001–2007. We document that an increase in firm’s size increases its bargaining power relative to workers. We measure firm level markups, and show that they increase with firm’s output and market size. We find that wage rises with firm’s productivity, but fall with its market power. The results are robust to various model specifications estimated at the firm and industry levels.

Analysis of the Impact of Changes in the Functional Distribution of Income on Aggregate Demand

Analysis of the Impact of Changes in the Functional Distribution of Income on Aggregate Demand

Artificial Intelligence and the Future of Labour Demand

Artificial intelligence (AI) is set to influence every aspect of our lives. As a technology platform, AI can automate tasks previously performed by labour or create new tasks and activities in which humans can be productively employed. Recent technological change has been biased towards automation, with insufficient focus on creating new tasks where labour can be productively employed. The consequences of this choice have been stagnating labour demand, declining labour share in national income, rising inequality and lowering productivity growth. The current tendency is to develop AI in the direction of further automation, with better economic and social outcomes.