Competition policy and labor income share: Evidence from the antitrust policy in China

Rui Cheng, Jing Li and Ting Wu

Economic Analysis and Policy, 2024, vol. 83, issue C, 966-977

Abstract: This study examines the impact of increased market competition on labor income share. We use the enactment of China's Anti-Monopoly Law as a quasi-natural experiment. The results reveal that the Anti-Monopoly Law has a significant positive effect on the labor income share of firms with higher market power. This is because the rising market competition, effected by the Anti-Monopoly Law, inhibits market power and increases average labor wages. Our findings are relevant for firms in provinces with higher administrative monopolies, with less competition, and under industries with less competition.

Keywords: Competition policy; Market power; Anti-Monopoly Law; Labor income share (search for similar items in EconPapers)
JEL-codes: D21 D33 D43 E25 (search for similar items in EconPapers)
Date: 2024
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:ecanpo:v:83:y:2024:i:c:p:966-977

DOI: 10.1016/j.eap.2024.08.003

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