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RESEARCH PAPER
Wage- or Profit-Led Regime? The Case of Poland
1
SGH Warsaw School of Economics, Poland
Submission date: 2023-08-04
Final revision date: 2023-11-09
Acceptance date: 2024-01-07
Publication date: 2024-03-28
GNPJE 2024;317(1):5-18
KEYWORDS
JEL CLASSIFICATION CODES
ABSTRACT
This study aims to investigate whether the Polish economy operates under a wage-led or profit-led economic regime. By analysing how changes in income distribution affect consumption, investment, and net exports, insights are gained into the nature of the economic regime, facilitating evidence-based policy formulation and fostering sustainable economic development in the country. The long-term impact of an increase in the profit share on economic growth is found to be significantly negative, giving rise to the conclusion that the Polish economy was in a wage-led regime from 2001 to 2022. The estimated total marginal effect of an increased profit share on output, including multiplier mechanisms, is –0.22.
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