scholarly journals Falling Labor Share and Rising Unemployment: Long-Run Consequences of Institutional Shocks?

2002 ◽  
Vol 3 (4) ◽  
pp. 431-459 ◽  
Author(s):  
Norbert Berthold ◽  
Rainer Rainer ◽  
Eric Thode
Keyword(s):  
Labor Market ◽  
Capital Stock ◽  
Job Creation ◽  
Capital Formation ◽  
Labor Share ◽  
Long Run ◽  
The Impact

Abstract The literature on unemployment has mostly focused on labor market issues while the impact of capital formation is largely neglected. Job creation is often thought to be a matter of encouraging more employment on a given capital stock. In contrast, this paper explicitly deals with the long-run consequences of institutional shocks on capital formation and employment. It is shown that the usual tradeoff between employment and wages disappears in the long run. In line with an appropriation model, the estimated values for the long-run elasticities of substitution between capital and labor for Germany and France are substantially greater than one.

Open Door System and Endogenous Growth in Indian Economy: An Empirical Analysis on the Role of Human Capital and R&D in Explaining Industrial Productivity

2021 ◽  
Vol 46 (1) ◽  
pp. 24-37
Author(s):  
Arjun K. ◽  
Sanjay Kumar ◽  
A. Sankaran ◽  
Mousumi Das
Keyword(s):  
Human Capital ◽  
Exchange Rate ◽  
Real Exchange Rate ◽  
Endogenous Growth ◽  
Value Added ◽  
Capital Formation ◽  
Knowledge Capital ◽  
Test Technique ◽  
Long Run ◽  
The Impact

The present study investigates the impact of human capital, knowledge capital which is a function of human capital, and real exchange rate scenario in explaining long-run industrial total factor productivity (TFP) from 1980 to 2015 on the theoretical basis of the open endogenous growth model. The variables employed in the contemporary study include manufacturing value added (MNVA) as industrial output measure, gross fixed capital formation (GFCF) as a measure of capital and labour input which is measured using employment data. Gross enrolment ratio (GER) is taken as a measure for human capital formation, expenditure on research and development (R&D) as a proxy for knowledge capital, and real exchange rate indicates global economic shocks. The study involves estimating TFP for Industrial Sector during the post-liberalization period by employing Cobb-Douglas production function. The ARDL bounds test technique for cointegration revealed long-run relation among the varying factors studied. The Toda-Yamamoto causality test concluded bi-directional causality running between, R&D expenditure and Industrial TFP which sends a strong signal to the policymakers for a well-framed long-term integrated approach for human & knowledge capital formation which will act as a strong impetus for manufacturing firms to come up in terms of augmenting production and productivity and expanding foreign market horizon. JEL Classification: D24, E2, J24

The Rise of Artificial Intelligence

2020 ◽  
pp. 1298-1313
Author(s):  
Robert Niewiadomski ◽  
Dennis Anderson
Keyword(s):  
Artificial Intelligence ◽  
Labor Market ◽  
Exponential Growth ◽  
Cognitive Abilities ◽  
Full Range ◽  
Rapid Expansion ◽  
Employment Opportunities ◽  
Strong Ai ◽  
Long Run ◽  
The Impact

Our inventions defined the work we engaged in for centuries; created new industries and employment opportunities around them. They, however, had often unforeseen consequences that affected the way we lived, interacted with each other, and redefined our societal rules. The established narration portrays the impact of major technological leaps in civilization on employment as temporary disruptions: Many finds themselves without employment taken away from them by efficient, laborsaving inventions, but, in the long run, through gradual adaptations, improved education and gaining higher qualifications, everyone benefits. In this chapter, the authors explore the impact of the rapid expansion of artificial intelligence (AI) in relations to the labor market. The authors argue that this rather optimistic, even naïve scenario, collapses while confronted with the exponential growth of AI; in particular, with the potential arrival of syneoids – robotic forms of “strong AI” possessing, or even exceeding, the full range of human cognitive abilities.

Forecasting the Impact of Automation on Jobs

2021 ◽  
pp. 21-40
Author(s):  
Cynthia Estlund
Keyword(s):  
Labor Market ◽  
Job Creation ◽  
Job Destruction ◽  
Advanced Education ◽  
Comparative Advantages ◽  
Human Skills ◽  
Minority View ◽  
The Impact

Chapter 2 digs more deeply into the outlook for job destruction and job creation, and adds some theory and data to Chapter 1’s anecdotes about how machines can replace human workers. It reports an emerging consensus among leading scholars that automation is already contributing to the polarization, or hollowing out, of the labor market by destroying more middle-skill jobs than it is creating. And it reports on the more concerning prediction—still a minority view though more than plausible—that machines are destined to produce overall net job losses as they continually whittle away at humans’ comparative advantages. The chapter arrives at a working premise for the rest of the book that straddles those two forecasts: We are facing a future of less work—at least less work for those with ordinary human skills and without advanced education, and perhaps less work overall. While that straddle might seem untenable, either forecast is similarly bleak for most workers—if we do not respond constructively; and when it comes to the shape of a constructive response, both forecasts point largely in the same direction.

scholarly journals The Relationship Between Government Expenditures on Education and Economic Growth: The Case of Azerbaijan

2020 ◽  
Vol 11 (1) ◽  
pp. 195
Author(s):  
Shahriyar Mukhtarov ◽  
Ilkin Mammadov ◽  
Sugra Humbatova
Keyword(s):  
Economic Growth ◽  
Total Population ◽  
Capital Formation ◽  
Government Expenditures ◽  
Educational Investment ◽  
Concerted Effort ◽  
Policy Makers ◽  
Long Run ◽  
The Impact ◽  
The Relationship

This paper investigates the impact of government’s education expenditures, gross capital formation and total population on economic growth in Azerbaijan during 1995-2018 using the different cointegration methods, namely, ARDLBT, DOLS, and CCR. The results from cointegration methods approve presence of long-run relationship among the variables. The estimation results show that government’s expenditures on education, gross capital formation and total population have a positive and statistically significant impact on economic growth in the long-run. The paper concludes that a concerted effort should be made by policy makers to increase educational investment in order to escelate economic growth.

The long run impact of immigration on labor market in an advanced economy

2015 ◽  
Vol 42 (4) ◽  
pp. 356-367
Author(s):  
Faridul Islam ◽  
Saleheen Khan
Keyword(s):  
Labor Market ◽  
Gdp Per Capita ◽  
Advanced Economy ◽  
Content Type ◽  
Dynamic Relationship ◽  
Long Run ◽  
The Usa ◽  
Short Run ◽  
Per Capita ◽  
The Impact

Purpose – The purpose of this paper is to examine the dynamic relationship among immigration rate, GDP per capita, and and real wage rates in the USA. Design/methodology/approach – The paper implements the Johansen-Juselius (1990, 1992) cointegration technique to test for a long-run relationship; and for short-run dynamics the authors apply Granger causality tests under the vector error-correction model. Findings – The results show that the long-run causality runs from GDP per capita to immigration, not vice versa. Growing economy attracts immigrants. The authors also find that immigration flow depresses average weekly earnings of the natives in the long-run. Originality/value – The authors are not aware of any study on the USA addressing the impact of immigrants on labor market using a tripartite approach by explicitly incorporating economic growth. It is therefore important to pursue a theoretically justified empirical model in search of a relation to resolve on apparent immigration debate.

scholarly journals Impact of the Domestic Labor Market on Sustainability of Agriculture in Oman

2019 ◽  
Vol 23 ◽  
pp. 24
Author(s):  
Hemesiri Bandara Kotagama ◽  
Hamam Al-Farsi
Keyword(s):  
Land Use ◽  
Labor Market ◽  
Food Security ◽  
Agricultural Sector ◽  
Agricultural Land ◽  
Land Use Intensity ◽  
Farm Production ◽  
Government Sector ◽  
Long Run ◽  
The Impact

Undistorted factor markets are a perquisite for efficient allocation of resources and growth in production. In Oman by 2013, only 16% of households have reported agriculture as the main occupation and 53% have reported nonagricultural government employment as the main occupation. This situation is hypothesized to be related to the labor market; where government legislated higher remuneration in the nonagricultural government sector vis-a-vis agricultural sector, influences Omani farmers to move to nonagricultural employment, causing reduced cultivated area and farm production. The study uses operations research methods to quantify the impact of labor market policies on agricultural employment, farm gross income and land use intensity (proxy for farm production and food security). It is found that the shift of Omani labor from agriculture is influenced by higher wages in the nonagricultural sectors. The agricultural land use intensity is thereby decreased. The policy of allowing hiring of expatriate labor is beneficial in overcoming labor scarcity. However, in the long-run both farm productivity need to improve to be competitive with legislated income receivable from nonagricultural employment and ideally labor markets need to operate freely, to enhance food security and assure employment of Omani labor in agriculture.

scholarly journals Respons Of Islamic Stock Markets To Monetary Policy Empirical Evidence from Indonesia

2019 ◽  
Vol 1 (1) ◽  
pp. 35-46
Author(s):  
Muhammad Rasyidin ◽  
Zunaidah Sulong
Keyword(s):  
Economic Growth ◽  
Monetary Policy ◽  
Stock Market ◽  
Significant Relationship ◽  
Policy Instruments ◽  
Capital Formation ◽  
Alternative Source ◽  
Market Strategy ◽  
Long Run ◽  
The Impact

AbstractPurpose - The impact of stock market and capital formation on economic growth in Indonesia for the period of January 2015 – May 2019. This paper examines a long-run equilibrium relation between stock market, capital formation and economic growth and other control variables.Method - This study uses autoregressive distributed lag (ARDL) model.Result - Findings revealed that none of the models was stationary at level but were all stationary at first difference. There is not a short run significant relationship between stock market, capital formation and economic growth in Indonesia. In the long run, capital formation has a significant positive association on economic growth and a negative non-significant relationship between stock market and economic growth in Indonesia.Implication - This research is useful to know the response of Sharia market to monetary policy instruments in Indonesia so that the Sharia stock market strategy is potentially developing in the future to encourage the achievement of characteristics such as An alternative source of financing and investment for economic actors and able to facilitate risk mitigation needs for market participants and able to drive the efficiency of transactions in the market through the improvement of the quality of stock market infrastructure Sharia.  Originality - The update of this research is response of Sharia stock market response to monetary policy instruments in Indonesia that are researched using ARDL models.

scholarly journals Long term relationship between exports, gross domestic capital formation, transfer fund allocation, and private investment in Jambi Province

2021 ◽  
Vol 8 (6) ◽  
pp. 631-650
Author(s):  
Sayid Syekh ◽  
Zainuddin Zainuddin
Keyword(s):  
Impulse Response Function ◽  
Private Investment ◽  
Capital Formation ◽  
Vector Error Correction ◽  
Current Period ◽  
Long Run ◽  
Domestic Capital ◽  
Long Time ◽  
The Impact

This study investigates the relationship between Jambi export with gross domestic capital formation, allocation of transfer funds, and private investment, based on the Vector Error Correction Model (VECM). The results show that, both in the short and long term, the gross domestic capital formation, allocation of transfer funds, and private investment can explain changes in Jambi exports. The gross domestic capital formation strongly influences Jambi's export fluctuations compared to other variables. There is a disequilibrium relationship in the short term, and it becomes equilibrium in the long run. Only 69 percent of export changes can be determined in the current period, and the rest is determined in other periods. Likewise, the gross domestic capital formation, only 38 percent, can be determined in the current period, and the rest is determined in other periods. Based on the impulse response function, the impact of export shocks has a large impact on itself. Shocks have a very significant impact and have a long lead to stable levels. Shocks can cause changes in Jambi exports to gross domestic capital formation. Shocks to the formation of gross domestic capital formation require a long time to reach a stable level.

scholarly journals Respons Of Islamic Stock Markets To Monetary Policy Empirical Evidence from Indonesia

2019 ◽  
Vol 1 (1) ◽  
pp. 35
Author(s):  
Muhammad Rasyidin ◽  
Zunaidah Sulong
Keyword(s):  
Economic Growth ◽  
Monetary Policy ◽  
Stock Market ◽  
Significant Relationship ◽  
Policy Instruments ◽  
Capital Formation ◽  
Alternative Source ◽  
Market Strategy ◽  
Long Run ◽  
The Impact

<p class="StyleIABSSSLatinBoldGray-80">Abstract</p><p class="IABSSS"><strong>Purpose</strong> - The impact of stock market and capital formation on economic growth in Indonesia for the period of January 2015 – May 2019. This paper examines a long-run equilibrium relation between stock market, capital formation and economic growth and other control variables.</p><p class="IABSSS"><strong>Method</strong><strong> </strong>- This study uses autoregressive distributed lag (ARDL) model.</p><p class="IABSSS"><strong>Result</strong><strong> </strong>- Findings revealed that none of the models was stationary at level but were all stationary at first difference. There is not a short run significant relationship between stock market, capital formation and economic growth in Indonesia. In the long run, capital formation has a significant positive association on economic growth and a negative non-significant relationship between stock market and economic growth in Indonesia.</p><p class="IABSSS"><strong>Implication</strong> - This research is useful to know the response of Sharia market to monetary policy instruments in Indonesia so that the Sharia stock market strategy is potentially developing in the future to encourage the achievement of characteristics such as An alternative source of financing and investment for economic actors and able to facilitate risk mitigation needs for market participants and able to drive the efficiency of transactions in the market through the improvement of the quality of stock market infrastructure Sharia.  </p><p><strong>Originality</strong> - The update of this research is response of Sharia stock market response to monetary policy instruments in Indonesia that are researched using ARDL models.</p>

Foreign Direct Investment, Financial Development, and Economic Growth Nexus in Bangladesh

2020 ◽  
pp. 056943452093867
Author(s):  
Md. Noman Siddikee ◽  
Mohammad Mafizur Rahman
Keyword(s):  
Economic Growth ◽  
Foreign Direct Investment ◽  
Financial Development ◽  
Direct Investment ◽  
Banking Sector ◽  
Negative Impact ◽  
Capital Formation ◽  
Long Run ◽  
Short Run ◽  
The Impact

This article aims to explore the short- and long-run impact of foreign direct investment (FDI), financial development (FD), capital formation, and the labor forces on the economic growth of Bangladesh. We applied the Granger causality test and Vector Error Correction Model (VECM) for this study. The World Bank data for the period of 1990–2018 are taken into account for the analysis. Our findings suggest, in the long run, capital formation has a positive impact, and in the short run, it has a negative impact on gross domestic product (GDP) implying a lack of higher efficiency is persisting in capital management. Similarly, labor forces have an insignificant impact in the short run and a negative impact in the long run on GDP, which confirms the presence of a huge number of unskilled laborers in the economy with inefficient allocation. The impact of FD is found tiny positive in the short run but large negative in the long run on GDP indicating vulnerability of banking sector. These also confirm fraudulence and inefficient use of the domestic credit supplied to the private sector. The impact of FDI is approximately null both in the short and long run, indicating Bangladesh fails to achieve the long-term benefits of FDI. Finally, this study suggests using FDI more in the capital intensive project of the public–private partnership venture than infrastructural development only and also improving the credit management policy of the banking sector. JEL Classifications: F21, F43, J21

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