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The dependence of real income and inequality on changes in factor abundance, total factor productivity, factor bias, the relative cost of capital goods and the progressivity of the tax system are quantified using an elemental general equilibrium model with three households. Observed declines in low-skill labour shares are shown to have been generic in the OECD and to have been responsible for most of the increase in US inequality between 1990 and 2016. The widely anticipated future twist away from low-skill labour toward capital is then examined, in combination with expected changes in population and its skill composition. With downward rigidity of low-skill wages the potential is identified for unemployment to rise to extraordinarily high levels. Productivity growth at twice the pace since 1990 is shown to limit this, though it does not slow the concentration of income. The superior policy response is shown to be a generalization of the US “earned income tax credit” system, with financing from taxes on consumption, rather than capital income.

The aim of this paper is to examine the increasing use of the home as a workplace and establish its significance for housing studies. Firstly, the article sketches its historical growth founded in technological and business model changes. Using cross-country datasets, it identifies variations across the EU in the scale and characteristics of home working, which by 2015 was the practice for about 1 in 6 EU workers, a ratio that has been greatly boosted by responses to the coronavirus pandemic. Secondly, the article considers the implications of increasing home working for housing studies. This is illustrated through a consideration of influences on our understanding of housing demand, particularly in terms of housing form and location. Further, we consider consequences for other areas of theory on the meaning of home, boundaries between public and private realms, and gender perspectives on the division of domestic work and space.

We study the effects of income distribution on comparative costs and show that the presence of produced means of production dramatically affects the possibility to build a “chain of comparative advantages” to explain the direction of trade. Specifically, we show that: i) comparative autarky costs are bad predictors of the trade pattern because comparative costs are no longer proportional to relative wages; ii) to ensure that a single break in the chain suffices to separate imported from exported commodities, at most one tradable capital good may be employed in production. With heterogeneous capital goods, the chain may need to be broken into many segments. iii) A change in the profit rate may alter the ordering of the links, even if the chain is well behaved for a constant profit rate. And iv) the plausibility of the chain of comparative advantages requiring multiple links for the same industry increases with the profit rate.

Changes in India's economic policies during the last three decades were expected to spur competition in the domestic market. Greater competition, particularly in capital goods, was expected to improve production efficiency. An important dynamic to analyze manufacturing sector's efficiency is to understand the relationship between industry's value addition and value of output. In the case of India's formal manufacturing sector, the share of value addition in output has declined sharply since 1998–99. This raises a question as to whether the Indian manufacturing sector is going through a phase of ‘hollowing out’. This paper examines the potential reasons behind such decline. One such reason relates to the intensity at which inter- mediate goods are used in the production process. The value of intermediate goods relative to the gross value of output is as high as two-third in India's formal manufacturing sector. Despite the recognition of the importance of intermediate goods as an input, it has received relatively little attention in the literature on development accounting. The paper considers a model on the assumption that a firm's production function is measured in terms of capital, labour, and intermediate goods. The paper estimates the output elasticity of intermediate inputs for the formal manufacturing sector and assesses how it has changed during the 1990s and 2000s. The production function is estimated using both fixed effects and Levinsohn and Petrin model to control for the endogenous productivity problem. The paper quantifies the relationship between the intensity at which a concerned industry utilises intermediate goods in the production process and productivity (TFP) of the sector. The empirical analysis points toward a biasness in productivity that may arise if one ignores the importance of intermediate goods as a production factor. The analysis highlights that the intensity of intermediate-goods impact the productivity observed in India's formal manufacturing sector from 1988–90 to 2015–16.