Essay Sample on Factors Impacting Labor Shares: Bargaining Power & Globalization

Introduction

Young and Zuleta discovered that some factors might bring about impacts on labor shares. They realized that these factors might include bargaining powers. Bargaining power was identified to affect labor shares through raising globalization while minimizing the unionization. Moreover; they indicated that other than lobar shares being affected by the bargaining power, it can also be lowered down through the employment of fewer workers in a given workplace. Also, they put across that labor shares should be improved by means such as an increase in wages among the individuals involves. Moreover, they indicated that union workers could only earn more wages depending on their profits shares.

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Furthermore, Young and Zuleta found out that products involved in labor shares may be achieved through the thorough provision of adequate agencies and accumulation of firms, for instance, human capital. Also, they identified that labor shares might predict productivity by hiring more workers in different workplace. They also discovered that labor shares vary depending on work done such that it may increase and sometimes decline. Also, the labor shares can be realized through increasing wages which may, in turn, increase the productivity leading to accumulation of more profits. Also, through their findings, they come to realize that labor and Unions relates provided that labor and profit is concerned.

Young and Zuleta also identified that the pressures that usually occurs on wages are as a result of substitution from the firms to increase production. They also indicated that inelasticity of the labor demand is caused by poor substitution methods. What was noted also is that the key parameter of determining the size and signs of any union-labor is attained by substituting capital with labor.

Labor share could be determined by looking at the shift in the share-capital schedule to enhance more productivity (Young, A. T., & Zuleta, H. 2018). Alternatively, they realized that labor share could be measured by comparing the rise in wages against the rate of competition which might exist. Moreover, they come up with how to compare the elasticity of substitution, which might arise when relating capital and labor. Through their findings, they discovered that no matter how great the elasticity of substitution it exists especially when handling capital and labor, what only matters is the unity which is used to determine the shape of share-capital schedule.

They also discovered that there was an urgent need to involve more unions of members and the addition of ratios in terms of capitals to increase the labor shares among the people. Also, labor shares may be improved through averaging the values which are usually obtained during the process of finding out individual shares. Also, from the research, it is apparent that not only labor shares are affected by the union of membership rates, but it can also be hindered by incorporation of some changes (Young, A. T., & Zuleta, H. 2018). The changes that were found out include; increase in labor costs and introduction of new techniques which saves productivity, for instance, factor-saving, which can be determined through minimizing the rates of time used during labor. Also, Young and Zuleta indicated that the competition which usually occurs in the labor markets is as a result of emergency of the high rate of globalization.

Reference

Young, A. T., & Zuleta, H. (2018). Do unions increase labor shares? Evidence from US industry-level data. Eastern Economic Journal, 44(4), 558-575 https://www.researchgate.net/profile/Hernando_Zuleta/publication/330347137_SSRN-id1942314pdf/data/5c3a41d992851c22a370c92b/SSRN-id1942314.pdf