Mertens, Matthias2025-05-292019https://epflicht.bibliothek.uni-halle.de/handle/123456789/74021066533628urn:nbn:de:gbv:3:2-1048022954755This article investigates how changing production processes and increasing market power at the firm level relate to a fall in Germany’s manufacturing sector labour share. Coinciding with the fall of the labour share, I document a rise in firms’ product and labour market power. Notably, labour market power is a more relevant source of firms’ market power than product market power. Increasing product and labour market power, however, only account for 30% of the fall in the labour share. The remaining 70% are explained by a transition of firms towards less labour-intensive production activities. I study the role of final product trade in causing those secular movements. I find that rising foreign export demand contributes to a decline in the labour share by increasing labour market power within firms and by inducing a reallocation of economic activity from nonexporting-high-labour-share to exporting-low-labour-share firms.1 Online-Ressource (III, 74 Seiten, 1,85 MB) : Diagrammeenghttp://rightsstatements.org/vocab/InC/1.0/330Book