Social Insurance Contribution Burdens and Enterprise Transformation and Upgrading
In recent years,the rapid growth of social insurance fund revenue has imposed a significant financial burden on enterprises,which,as primary contributors to the fund,are compelled to navigate this challenge.In order to survive and maximize profits,enterprises have to seek better countermeasures,that is,transformation and upgrading to solve the financial difficulties caused by social insurance payment.Against the backdrop of innovation-driven development,investigating the counteractive implications of rising labor costs,such as those incurred through social insurance contributions,on enterprise transformation and upgrading holds both theoretical significance and practical implications.This study provides empirical evidence at the micro-enterprise level,shedding light on the internal logic of industrial structure transformation and upgrading.Theoretically,the motivations for enterprises to undergo transformation and upgrading in response to increased labor costs can be broadly categorized into three explanations.First,factor substitution theory,as articulated by Hicks(1932),posits that as the price of labor production factors rises,the relative price of capital factors declines,prompting enterprises to substitute labor with more capital to drive technological innovation.Second,the"creative destruction"theory,pioneered by Schumpeter(1934),posits that innovation,essentially a form of creative destruction,stimulates economic growth by phasing out old technologies and equipment in favor of new ones.Third,the incentive effect of"efficiency wages",based on the"shirking model"(Shapiro & Stiglitz,1984),suggests that as employee wages increase,the opportunity cost of dismissal rises,encouraging heightened employee effort,and thus improving production efficiency and fueling enterprise transformation and upgrading.Empirically examining Chinese A-share listed companies from 2007 to 2019,this study scrutinizes enterprises'choices under the burden of social insurance contributions across two dimensions:transformation(internal and external)and upgrading(R&D investment and the proportion of highly educated individuals).Results indicate a conspicuous counteractive effect of social insurance contribution burdens on enterprise transformation and upgrading.Particularly,when enterprises face significant financing constraints and exhibit a high proportion of corporate debt financing,those burdened by social insurance payments tend to prioritize internal transformation while reducing engagement in external transformation and upgrading activities.However,internal transformation under social insurance payment burdens markedly diminishes firm value,while increased R&D investment proves advantageous for its augmentation.Further analysis reveals a causal link between social insurance payment burdens and reduced corporate profits as well as heightened operational pressures,which compels firms to address these challenges through strategic transformation and upgrading.In situations where the interests of management and shareholders align,companies typically opt for upgrading over transformation.Concurrently,the action-forcing impact of the social insurance contribution burdens on enterprise upgrading surpasses its influence on transformation.Heterogeneity analysis indicates that enterprises characterized by lower labor intensity or possessing non-SOE-owned property rights are more inclined to pursue external transformation and upgrading when confronted with the challenges posed by social insurance payment burdens,and the scope of such external transformation and upgrading tends to be more extensive.In contrast to the existing literature,this paper makes notable contributions across three key dimensions.Firstly,it introduces a novel and comprehensive conceptualization of transformation and upgrading,enriching the relevant discourse on the influencing factors of enterprise evolution.Secondly,this study extends the literature by delving into the intricate dynamics of social insurance contributions on micro-financial behaviors.By scrutinizing the impact of the social insurance payment burdens on enterprise transformation and upgrading,we reveal that the surge in labor costs,stemming from these payments,compels enterprises to strategically shift gears.Thirdly,this paper holds significant implications for micro-level enterprise reform,providing empirical support for an innovation-driven development strategy.Our findings underscore that,when faced with the weight of social insurance payments,opting for transformation(increased investment in fixed assets)proves detrimental to firm value,while choosing upgrading(escalated investment in R&D)yields benefits to firm value.Hence,the imperative strategy for firms navigating these challenges is an augmented investment in R&D to fortify independent innovation capabilities.
Social Insurance Contribution BurdenTransformation and UpgradingFinancing ConstraintFinancing StructureFirm Value
万方数据
维普
