Technology transfer and the functional distribution of income in japan: 1952-1981

Estimation of a reduced form equation for the wage bill/profit ratio for Japan indicates that technology transfer had a significant and negative effect on labor’s share of income between 1952 and 1981. This effect was twice as large for 1952-1969 when the Japanese government promoted the importation of capital-intensive technology as it was in 1970-1981 when the Japanese government promoted “knowledge” intensive technology. A two-stage least- squares estimate of the employment structural equation indicates that the effect of both technology transfer and indigenous technology was greater than or equal to zero in both time periods.