The Skill Premium Effect of Production Segmentation:Empirical Evidence from Enterprise Level
Abatract:The theory of international trade factor allocation is difficult to explain the fact that China's labor income gap con-tinues to widen with the expansion of exports.Unlike existing literature that focuses on inter industry and intra industry trade perspectives,this article attempts to interpret this issue from the perspective of intra product trade division of labor.It is dis-covered that the GVC division of work distinguished by manufacturing segmentation has a significant impact on the skill wage premium of enterprises,leading to an widening labor income gap.Firstly,a theoretical model was constructed to incorporate production segmentation and skill wage premium into a unified theoretical analysis framework.Based on micro enterprise data in China,the impact and mechanism of production segmentation on skill premium were empirically tested.The research con-clusion indicates that:firstly,production segmentation has a significant positive effect on the skill premium of enterprises;Secondly,the mechanism test shows that production segmentation mainly exerts the skill premium effect by increasing the pro-ductivity of enterprises and affecting the total profit of enterprises,as well as improving the quality of exported products and affecting the profit distribution of enterprises;Thirdly,heterogeneity testing indicates that the impact of production segmenta-tion on skill wage premiums is more pronounced when the enterprise is non-state-owned,capital intensive,technology inten-sive,and in the eastern region.The meaning of this paper is that while China is deeply involved in the division of labor in global intra product trade and leveraging the economic benefits of production division to reduce costs and improve quality,it should also pay attention to the wage gap and income inequality it causes,in order to balance efficiency and fairness.Compared with existing research,the main marginal contribution of this article lies in:firstly,from the perspective of in-tra product trade division of labor,this article interprets the determining factors of enterprise skill wage premiums,providing theoretical support for the relationship between production division and enterprise skill premiums,expanding and enriching the literature on the determining factors of skill wage premiums,and providing new explanations for the fact that China's labor income gap continues to expand with export expansion.Secondly,in the theoretical analysis,this article expands the theoreti-cal framework of the factors influencing skill premiums.By constructing a mathematical model and introducing production segmentation into the fair wage model,the impact and underlying mechanism of production segmentation on the skill premium of enterprises were analyzed based on the mathematical model.Thirdly,in the mechanism testing,this article examines the mechanism by which production segmentation enhances the skill wage premium of enterprises by improving their productivity and export product quality.It reveals the economic benefits of production segmentation in reducing costs,improving quality,and increasing efficiency,as well as the skill premium effect it brings.This effectively widens the potential mechanism for the widening labor income gap caused by global production division.Fourthly,in terms of policy significance,the research find-ings of this article indicate that production segmentation not only positively improves enterprise productivity and export prod-uct quality,but also leads to an expansion of skill wage premiums.This means that the global value chain division of labor model characterized by production segmentation has put forward higher requirements for China to achieve common prosperity,which provides useful insights for improving the income distribution system in the context of high-level opening up to the out-side world.
Production SegmentationSkill PremiumTotal Factor ProductivityRegional Institutional Environment
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