Comparative Economic Studies

, Volume 59, Issue 1, pp 55–76 | Cite as

Labour and Financial Crises: Is Labour Paying the Price of the Crisis?

  • Remi BazillierEmail author
  • Boris Najman
Original Article


This paper investigates the relationship between the labour share and financial crises. While Diwan (2001) or Maarek et al. (2013) focused on the currency crisis, we propose to see if their analyses can be extended to the banking crisis and how it can influence the relative bargaining power of labour and capital within firms. To this end, we use international panel data of the share of labour in GDP. We confirm the existence of a negative trend for the labour share, which is largely explained by financial crises. However, the results differ for currency and banking crises. Currency crises affect the labour share negatively, while banking crises primarily affect capital income, at least during the year of the crisis. In the three years following a currency crisis, the labour share tends to be reduced by around 2% per year on average.


labour share banking crises currency crises 

JEL Classification

E25 E44 G01 



We would like to thank the University Paris 1 Panthéon-Sorbonne, and the Panthéon-Sorbonne Doctoral School of Economics (Collége des écoles doctorales) for financial support. We also would like to thank Paul Wachtel, the editor, for his valuable comments and suggestions as well as two anonymous referees. We thank Fabian Gouret, Mathieu Couttenier and Jérome Hericourt for helpful comments, Nicolas Berman and Arnaud Sylvain for providing us tractable data, respectively, on financial crises and on the labour share. This paper also benefited from the comments of the Fudan University - Paris 1 workshop participants. All remaining mistakes are obviously ours.


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Copyright information

© Association for Comparative Economic Studies 2017

Authors and Affiliations

  1. 1.Univ. Paris 1 Panthéon-SorbonneParisFrance
  2. 2.Centre d’Economie de la Sorbonne (CES, UMR CNRS 8174)Paris cedex 13France
  3. 3.Université Paris-Est, ERUDITE, TEPPCreteilFrance

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