As Kaldor’s Facts Fall, Occupy Wall Street Rises: Peter Orszag

Oct. 19 (Bloomberg) -- In Economics 101, students learnthat the share of national income received by labor staysroughly constant with the share received by capital. This is thefirst of “Kaldor’s stylized facts,” articulated half a centuryago by the Cambridge economist Nicholas Kaldor.

Recent experience betrays this lesson. Over the past twodecades -- and especially since about 2000 -- the share ofnational income that flows into wages and other kinds of workercompensation has been plummeting in various countries.