The Global Labour Share in Penn World Table 11.0: An Exact Within–Reweighting Decomposition, Carried-Forward Data and a Near-Unit Elasticity of Substitution, 1970–2023

I measure the world labour share with Penn World Table 11.0 for a balanced panel of 95 economies, 1970 to 2023, weighting each economy by its output at current PPP. The weighted share fell from 0.606 in 1970 to 0.538 in 2008 and has been flat since, at 0.535 in 2023. An exact midpoint shift-share identity splits the 1970 to 2023 fall of 0.0709 into a within-economy fall of 0.0536 and a reweighting effect of 0.0173, from output moving towards lower-share economies. Almost all the decline happened between 1990 and 2008; from 2008 to 2023 the change was only minus 0.0026. The United States (minus 0.0104) and India (minus 0.0090) made the two largest within contributions over 1990 to 2023; India's share fell by 0.146, from 0.679 to 0.534. The data need care: in half of all country-years (0.505) the labour share is identical to the year before, and 50 of 140 economies show no change at all from 2019 to 2023. Under a CES technology the log capital share is linear in the log capital-output ratio with slope rho equal to (sigma minus 1) over sigma. Within countries, with year effects, rho is minus 0.046 (standard error 0.025), so sigma is 0.956 (95% interval 0.912 to 1.003). This rules out the elasticity above one that would be needed for capital deepening to explain the decline, and India's own slope of 1.64 lies outside the range any CES function allows.