  Labor share, the fraction of economic output accrued as wages, is
inexplicably declining in industrialized countries. Whilst numerous prior works
attempt to explain the decline via economic factors, our novel approach links
the decline to biological factors. Specifically, we propose a theoretical
macroeconomic model where labor share reflects a dynamic equilibrium between
the workforce automating existing outputs, and consumers demanding new output
variants that require human labor. Industrialization leads to an aging
population, and while cognitive performance is stable in the working years it
drops sharply thereafter. Consequently, the declining cognitive performance of
aging consumers reduces the demand for new output variants, leading to a
decline in labor share. Our model expresses labor share as an algebraic
function of median age, and is validated with surprising accuracy on historical
data across industrialized economies via non-linear stochastic regression.
