Low price and wage inflation Not everyone benefits from a more closely integrated global economy and new technology. In many countries, the competition for low-skilled jobs has intensified, depressing wages for these workers. On the other hand, technological advances have pushed up demand for high-skilled labour for which there is a wage premium. The result is wider wage gaps. The income distribution between labour and capital has also changed. It had long been a widely-held view among economists that the labour share of GDP would remain fairly constant over time. Keynes described the stability of the labour share as “one of the most surprising, yet best-established, facts in the whole range of economic statistics”.6 Yet since 1980, corporate profits have risen faster than wages (Chart 6). 6 Keynes, J.M (1939): "Relative Movements of Real Wages and Output", The Economic Journal 49 (193), pp 34–51. 6  Norges Bank  Chart 6 Labour share. Labour costs as a share of GDP. 1) Selected advanced economies. Percent 55  55  54  54  53  53  52  52  51  51  50 1978  1983  1988  1993  1998  2003  2008  2013  Economic perspectives 15 february 2018  50 2018  1) Belgium, Denmark, Finland, France, Germany (data for West Germany before 1992), Ireland, Italy, Japan, Netherlands, Portugal, Spain, South Korea, Sweden, Switzerland, the UK and the US. GDP−weighted average.
1990 = 100 350  350  300  300  250  250  200  200  150  150  100  100  Finance and insurance Mainland Norway  50 1990  50 1994  1998  2002  2006  2010  2014  Sources: Statistics Norway and Norges Bank  In parallel, banks’ branch networks have changed. In 1987, there were almost 200 bank branches in Oslo, while today there are fewer than 40. This has cut costs substantially for both banks and the general public. Our payment system is now among the world’s most modern and cost-efficient. 4 Salvanes, K.G. (2017): “Omstillingsevnen i norsk økonomi under finanskrisen” [The adaptability of the Norwegian economy during the financial crisis], Arbeidsnotat 2017/7, Ministry of Finance (Norwegian only). 4  The payment system is facing an era of change. Use of cash is on the decline, while deposit money is becoming available in ever newer forms. The next innovation is instant settlement, which will make it possible to transfer funds from one account to another immediately, regardless of amount. Maybe your car purchase can be paid by pressing “send” on your mobile phone and, at the very same instant, the seller can safely hand you the keys. Norges Bank Economic perspectives 15 february 2018  Banks continue to play a dominant role in the payment system, but there are clear signs that their position can be challenged. New regulations and technology are making it easier for new participants to take market share.