Deregulation of Market Access and Labor Income Share
China has created a liberalized market environment by improving market access regulations and providing favorable conditions for business operations.While deregulating market access stimulates market vitality,the equitable distribution of development gains remains a critical issue.Labor income share,which measures the proportion of national income allocated to labor,reflects the fairness of income distribution.Increasing labor income share is crucial to ensuring that workers fairly share in economic development gains.We employ the market access negative list system as a quasi-natural experiment and constructs a DID model to empirically examine the impact and mechanisms of deregulating market access on firms'labor income shares.The findings indicate that deregulating market access significantly enhances firms'labor income shares.This conclusion holds robustly across parallel trend tests,heterogeneous treatment effect analyses,and considerations of the non-randomness of policy pilots.Importantly,this increase does not result from the redistribution of labor income among firms.Mechanism analysis reveals that deregulation directly facilitates the entry of market entities,which,in turn,enhances firms'labor income shares by affecting their monopoly power,innovation investments,and investment activities.Further research shows that the primary source of increased labor income share is the improvement in wages for high-skilled employees rather than an increase in their numbers.Moreover,deregulating market access promotes fair income distribution among labor factors within firms,thereby reducing income disparities.Heterogeneity analysis demonstrates that the positive impact of deregulating market access on labor income shares is more pronounced for firms in regions with high levels of government intervention,manufacturing firms,and non-state-owned enterprises.The marginal contributions of this study are as follows:First,it integrates the market access negative list system with firms'labor income shares within a unified analytical framework,linking market access regulations with internal income distribution in firms and enriching the literature on market access systems.Second,from the perspective of market institutions,it broadens the research on factors influencing firms'labor income shares.Existing studies have yet to focus on the impact of market access regulations on labor income shares.By examining the market access negative list system's role in enhancing labor income shares,this study provides new insights for adjusting income distribution and improving labor remuneration.Theoretical and empirical evidence from this study reveals that deregulating market access is a significant factor influencing firms'labor income shares,offering clear policy implications.The Chinese government should further deepen the market access negative list system,enhance high-level coordination,and continuously and thoroughly promote the implementation of the"non-prohibited entry"principle.This will help build a higher-level market economy system and continuously unleash market vitality.
deregulation of market accessnegative list for market accesslabor income share
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