How do ex ante review systems improve firms' labor income shares: Empirical evidence from the fair competition review system

Jierong Chen and Zezheng Wang

International Review of Financial Analysis, 2024, vol. 96, issue PA

Abstract: Enhancing the proportion of labor income is essential for reducing income disparity and attaining widespread prosperity. This study utilizes the difference-in-differences (DID) approach to examine the relationship, using data from A-share listed corporations from 2011 to 2022. The discovery demonstrates that implementing the Fair Competition Review System can significantly enhance the labor income shares for executives and ordinary employees within enterprises. Nevertheless, the Fair Competition Review System has a more significant impact on the pay share of ordinary employees compared to executives. Additionally, the favorable effects are attained by increasing profits and reducing financing expenses. Furthermore, the firm's ownership structure and the executives' shareholding have diverse mediation impacts. This paper enhances the current body of research on the factors influencing the proportion of income corporate employees receive. It also provides novel perspectives on examining the governance systems that can enhance their income share.

Keywords: Ex ante review systems; Labor income shares; Fair competition review system; Financing costs reduction; Profit growth (search for similar items in EconPapers)
Date: 2024
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/S1057521924005787
Full text for ScienceDirect subscribers only

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:eee:finana:v:96:y:2024:i:pa:s1057521924005787

DOI: 10.1016/j.irfa.2024.103646

Access Statistics for this article

International Review of Financial Analysis is currently edited by B.M. Lucey

More articles in International Review of Financial Analysis from Elsevier
Bibliographic data for series maintained by Catherine Liu ().