Unequal exchange of labour in the world economy

Hickel, Jason, Hanbury Lemos, Morena and Barbour, Felix (2024) Unequal exchange of labour in the world economy. Nature Communications, 15 (1). ISSN 2041-1723

Text (Unequal exchange of labour in the world economy) - Published Version Available under License Creative Commons Attribution. Download (1MB)

• Scopus publication
• Author

Abstract

Researchers have argued that wealthy nations rely on a large net appropriation of labour and resources from the rest of the world through unequal exchange in international trade and global commodity chains. Here we assess this empirically by measuring flows of embodied labour in the world economy from 1995–2021, accounting for skill levels, sectors and wages. We find that, in 2021, the economies of the global North net-appropriated 826 billion hours of embodied labour from the global South, across all skill levels and sectors. The wage value of this net-appropriated labour was equivalent to €16.9 trillion in Northern prices, accounting for skill level. This appropriation roughly doubles the labour that is available for Northern consumption but drains the South of productive capacity that could be used instead for local human needs and development. Unequal exchange is understood to be driven in part by systematic wage inequalities. We find Southern wages are 87–95% lower than Northern wages for work of equal skill. While Southern workers contribute 90% of the labour that powers the world economy, they receive only 21% of global income.

Item Type:	Article
Official URL:	https://www.nature.com/ncomms/
Additional Information:	© 2024 The Author(s)
Divisions:	International Inequalities Institute
Subjects:	H Social Sciences > HD Industries. Land use. Labor H Social Sciences > HB Economic Theory H Social Sciences
JEL classification:	F - International Economics > F1 - Trade > F14 - Country and Industry Studies of Trade F - International Economics > F1 - Trade > F16 - Trade and Labor Market Interactions J - Labor and Demographic Economics > J3 - Wages, Compensation, and Labor Costs > J31 - Wage Level and Structure; Wage Differentials by Skill, Training, Occupation, etc. P - Economic Systems > P4 - Other Economic Systems > P45 - International Trade, Finance, Investment, and Aid
Date Deposited:	14 Aug 2024 10:00
Last Modified:	21 Nov 2024 02:51
URI:	http://eprints.lse.ac.uk/id/eprint/124543

Actions (login required)

View Item