Markups, Tobin's q, and the Increasing Capital Share

Jacob A. Kerspien, Jakob B. Madsen

Research output: Contribution to journalArticlepeer-review

1 Citation (Scopus)
140 Downloads (Pure)


Increasing markups have recently gained prominence as a leading explanation for the increasing share of income going to capital since the 1980s. However, the existing analysis has been limited to the United States, covers only short periods, and generally does not control for potentially important confounders. Constructing data for the share of income going to capital and markups based on Tobin's q over the period 1870–2018 for 21 advanced countries, this research examines the ability of markups to explain the movements of income shares and the tendency for factor shares to converge toward constants in the long run. We find strong support for the markup hypothesis.

Original languageEnglish
Pages (from-to)569-587
Number of pages19
JournalJournal of Money, Credit and Banking
Issue number2-3
Early online date23 Mar 2023
Publication statusPublished - 1 Mar 2024


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