Firm Ex Ante Heterogeneity, Entry, and the Labour Share

Grazzini, Jakob and Rossi, Lorenza (2023) Firm Ex Ante Heterogeneity, Entry, and the Labour Share. Economic Journal, 133 (649). pp. 235-257. ISSN 0013-0133

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Official URL: https://doi.org/10.1093/ej/ueac054

Abstract

This paper considers a two-sector RBC model augmented with firm heterogeneity and firm dynamics and studies the steady state and dynamic properties of the model in response to a decline in the relative price of investment. It shows that both firm heterogeneity and entry play a crucial role in the decline in the labour share and the increase in capital intensity observed in the US economy. Using ORBIS firm-level data of the US economy, the paper finds robust evidence consistent with the mechanisms described in the model.

Item Type:

Journal Article

Journal or Publication Title:

Economic Journal

Additional Information:

This is a pre-copy-editing, author-produced PDF of an article accepted for publication in BritishThe Economic Journal following peer review. The definitive publisher-authenticated version Jakob Grazzini, Lorenza Rossi, Firm Ex Ante Heterogeneity, Entry and the Labour Share, The Economic Journal, Volume 133, Issue 649, January 2023, Pages 235–257, https://doi.org/10.1093/ej/ueac054 is available online at: https://academic.oup.com/ej/article-abstract/133/649/235/6691719

Uncontrolled Keywords:

/dk/atira/pure/subjectarea/asjc/2000/2002

Subjects:

?? FIRM DYNAMICSFIRM HETEROGENEITYLABOUR INCOME SHARECAPITAL INTENSITYCAPITAL TECHNOLOGICAL CHANGEORBIS MICRODATAECONOMICS AND ECONOMETRICSE21E22E25 ??

Departments:

Lancaster University Management School > Economics

ID Code:

176099

Deposited By:

ep_importer_pure

Deposited On:

16 Sep 2022 12:25

Refereed?:

Yes

Published?:

Published

Last Modified:

29 Sep 2023 01:39

URI:

https://eprints.lancs.ac.uk/id/eprint/176099