Labor share, foreign demand and superstar exporters

This paper proposes a new determinant of labor share changes. Using micro-data on the universe French manufacturing exporters over 1995–2007, I show that measure export demand growth exogenous to firm-level outcomes drives down through two effects. First, foreign shocks allow low-labor share, highly internationalized “superstar” grow disproportionately more. Second, decreases and this effect is stronger for larger exporters. Both effects generate sizable decline, regardless aggregate dynamics. A simple heterogeneous-firm model with endogenous markups rationalizes my empirical results. Overall, these findings provide direct causal evidence “winner take most” phenomenon induced by trade globalization emphasize role increased competition international markets