Is the great decoupling real?
The great decoupling is real. Productivity and employment/wages link changed after 1980 in many countries, not just the U.S. This study investigates the productivity and employment/wages link (1950–2014) looking for empirical proof of the “great decoupling” put forward by Brynjolfsson and Mcafee (20...
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| Format: | Article |
| Language: | English |
| Published: |
Vilnius Gediminas Technical University
2017-06-01
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| Series: | Journal of Business Economics and Management |
| Subjects: | |
| Online Access: | https://journals.vgtu.lt/index.php/JBEM/article/view/1214 |
| _version_ | 1818383987441139712 |
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| author | Marinko Škare Damian Škare |
| author_facet | Marinko Škare Damian Škare |
| author_sort | Marinko Škare |
| collection | DOAJ |
| description | The great decoupling is real. Productivity and employment/wages link changed after 1980 in many countries, not just the U.S. This study investigates the productivity and employment/wages link (1950–2014) looking for empirical proof of the “great decoupling” put forward by Brynjolfsson and Mcafee (2013). The results should stimulate policymakers to openly question why real wages and productivity don’t line up with the theory. We use the Hodrick and Prescott (1997) filter to isolate trends in real wages, labor share in GDP, and labor productivity and rolling correlation to explore if the great decoupling is real. We have found that the great decoupling i.e. The divergence between real wages/employment and productivity is present in all countries (10 in the sample). The dynamics of the great decoupling are however different between the countries although year 1980 seems to be a dominant breaking point for the start of the phenomena. This paper provides multicounty empirical proof of the presence of the great decoupling phenomena and explores its dynamics over 1950–2014. Policy makers as well as firms and unions should take the existence of this phenomena seriously since it can have significant consequences on economic growth and labor markets’ functioning. |
| first_indexed | 2024-12-14T03:15:06Z |
| format | Article |
| id | doaj.art-4fa8836bef0744b3bc2f355fa510fb18 |
| institution | Directory Open Access Journal |
| issn | 1611-1699 2029-4433 |
| language | English |
| last_indexed | 2024-12-14T03:15:06Z |
| publishDate | 2017-06-01 |
| publisher | Vilnius Gediminas Technical University |
| record_format | Article |
| series | Journal of Business Economics and Management |
| spelling | doaj.art-4fa8836bef0744b3bc2f355fa510fb182022-12-21T23:19:10ZengVilnius Gediminas Technical UniversityJournal of Business Economics and Management1611-16992029-44332017-06-0118310.3846/16111699.2017.1323793Is the great decoupling real?Marinko Škare0Damian Škare1Juraj Dobrila University of Pula, Economics and Tourism “Dr. Mijo Mirkovic”, Preradoviceva 1, Preradoviceva 1, Pula, 52100 CroatiaSchool of Economics Pula, Kovačićeva ul. 3, 52100, Pula, CroatiaThe great decoupling is real. Productivity and employment/wages link changed after 1980 in many countries, not just the U.S. This study investigates the productivity and employment/wages link (1950–2014) looking for empirical proof of the “great decoupling” put forward by Brynjolfsson and Mcafee (2013). The results should stimulate policymakers to openly question why real wages and productivity don’t line up with the theory. We use the Hodrick and Prescott (1997) filter to isolate trends in real wages, labor share in GDP, and labor productivity and rolling correlation to explore if the great decoupling is real. We have found that the great decoupling i.e. The divergence between real wages/employment and productivity is present in all countries (10 in the sample). The dynamics of the great decoupling are however different between the countries although year 1980 seems to be a dominant breaking point for the start of the phenomena. This paper provides multicounty empirical proof of the presence of the great decoupling phenomena and explores its dynamics over 1950–2014. Policy makers as well as firms and unions should take the existence of this phenomena seriously since it can have significant consequences on economic growth and labor markets’ functioning.https://journals.vgtu.lt/index.php/JBEM/article/view/1214the great decouplingwage-productivity gapemploymentOECD countriesHodrick-Prescott filterrolling correlation |
| spellingShingle | Marinko Škare Damian Škare Is the great decoupling real? Journal of Business Economics and Management the great decoupling wage-productivity gap employment OECD countries Hodrick-Prescott filter rolling correlation |
| title | Is the great decoupling real? |
| title_full | Is the great decoupling real? |
| title_fullStr | Is the great decoupling real? |
| title_full_unstemmed | Is the great decoupling real? |
| title_short | Is the great decoupling real? |
| title_sort | is the great decoupling real |
| topic | the great decoupling wage-productivity gap employment OECD countries Hodrick-Prescott filter rolling correlation |
| url | https://journals.vgtu.lt/index.php/JBEM/article/view/1214 |
| work_keys_str_mv | AT marinkoskare isthegreatdecouplingreal AT damianskare isthegreatdecouplingreal |