The returns and risk premia of stocks with similar characteristics but different levels of ownership comove far more with shocks to the risk-bearing capacity of financial intermediaries. This implies that intermediaries are not a veil, even within the least-intermediated asset class.
We examine the content of newly emerging job categories over an 80-year period and the countervailing roles of labor-augmenting and automating innovations in generating demand for new work. The distribution of new work emergence polarized from middle-paid production and clerical occupations over 1940--1980, to high-paid professional and, secondarily, low-paid services since 1980. While the demand-eroding effects of automation innovations have intensified in the last four decades, the demand-increasing effects of augmentation innovations have not.
We develop measures of workers' exposure to labor saving and labor augmenting technologies. Labor-saving technologies uniformly predict earnings declines for individual incumbent workers; labor-augmenting innovations only do so for skilled incumbents, but they also predict higher aggregate occupational labor demand. We interpret our findings through a model with automation and skill displacement, and use it to make predictions about AI and worker earnings. Previously titled 'Technology, Vintage-Specific Human Capital, and Labor Displacement: Evidence from Linking Patents with Occupations.'
I use the heterogeneous responses to labor demand shocks between differentially productive firms to quantify the contribution of labor market power to firm profitability and labor shares. Cashflows from labor market power represent about 40% of total capital income, driven by highly productive firms with large and increasing wage markdowns. About half of the change in the aggregate labor share from 1991--2014 can be attributed to the rise in labor market power.
We propose a simple and computationally tractable methodology for computing similarity between two documents along with economic applications of the method.