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The aim of this study is to examine the effects of the 2008 financial crisis on the functional income distribution in Turkey by conducting a comparative analysis of various labor share measures using different data sources. Four different labor share measures in the total market income were calculated using micro data from the 2006 -2011 Income and Living Conditions Survey of Turkey. The results of microdata calculations indicated a substantial and permanent increase during the crisis due to the labor hoarding in the labor market, leading to an increase in skilled employees’ labor income share at the expense of unskilled employees’ labor income share. The results obtained from aggregate data-based labor share calculations with two different measures were relatively smaller than micro data-based labor shares, due to the large share of informal employment in Turkey. Further, the labor shares obtained from aggregate data decreased during the 2008 financial crisis, in contrast to the labor shares from micro data.



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Creative Commons License
This work is licensed under a Creative Commons Attribution-Noncommercial-No Derivative Works 3.0 License.