Labor Share of National Income: Revisiting a Forgotten Issue

Abstract

This paper intends to revisit the functional distribution of income in Mexico. It aimsat reviewing the evolution of the labor share of national income in the last 30 years.It compares its behavior with that of other countries and with recent global trends. Intrying to reach this objective, an examination of the trajectory of the Mexican economyin terms of growth, job creation and wage developments is essential. The country’spattern of insertion into the new global environment, technological change and laborinstitutions also play a significant role. These are all central elements in trying to understandthe evolution of aggregate factor income distribution and some of the issuesaffecting inequality and growth potential.