A1 Journal article (refereed)
Integrated capital shares (2020)

Juuti, T. (2020). Integrated capital shares. Applied Economics Letters, 27(18), 1533-1540. https://doi.org/10.1080/13504851.2019.1693695

JYU authors or editors

Publication details

All authors or editors: Juuti, Toni

Journal or series: Applied Economics Letters

ISSN: 1350-4851

eISSN: 1466-4291

Publication year: 2020

Volume: 27

Issue number: 18

Pages range: 1533-1540

Publisher: Routledge

Publication country: United Kingdom

Publication language: English

DOI: https://doi.org/10.1080/13504851.2019.1693695

Publication open access:

Publication channel open access:

Publication is parallel published (JYX): https://jyx.jyu.fi/handle/123456789/66696


In empirical macroeconomics, inter-dependencies between countries are often analysed using cross-country correlations or graphical investigation of time series. This study shows that applying an alternative methodological approach - identification of common unobservable factors and using them as explanatory variables for country-specific time series - indicates a stronger cross-country integration of functional income distributions than the standard methods. The results vary only little between different samples, where both the country and year coverage change. Moreover, the main findings are not sensitive to the way capital depreciation is taken into account. The primary driving factor seems to be the same irrespective of the set of countries and time period. Furthermore, in the majority of the countries, this factor is strongly correlated with both trade openness and total factor productivity, which have been suggested to be key drivers behind the changes in the division of income between capital and labour.

Keywords: income distribution; time series; international comparison; macroeconomics

Free keywords: functional income distribution; cross-country integration; principal component analysis

Contributing organizations

Ministry reporting: Yes

Reporting Year: 2020

JUFO rating: 1

Last updated on 2022-20-09 at 13:57