Entry deregulation and labor share: Evidence from China

Bo Chen, Huange Xu and Guangchen Li

Finance Research Letters, 2023, vol. 58, issue PD

Abstract: Based on the Negative List Policy (NLP) implemented in China, this paper uses Chinese A-share listed companies from 2007 to 2021 as sample and employs the staggered difference-in-differences (DID) method to examine the impact of entry deregulation on labor share. We find that after the implementation of NLP, enterprises in the treatment group experience a 4.4 % increase in labor share. Specifically, in the goods market, NLP will increase labor share by weakening market power and reducing monopoly profits. In the factor market, NLP will boost labor share by impeding capital deepening and increasing labor inputs.

Keywords: Entry deregulation; Labor share; Negative list policy; Staggered DID (search for similar items in EconPapers)
Date: 2023
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Citations: View citations in EconPapers (1)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:finlet:v:58:y:2023:i:pd:s1544612323009820

DOI: 10.1016/j.frl.2023.104610

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