Social Security Payment Rate Reduction and the Total Factor Productivity of Enterprises
Based on the natural experiments of the reduction of social security payment rate of enterprises in Zhejiang Provincial in 2012,this paper uses the differences-in-differences method to analyze the impact of the incident.We find that the decline in social security payment rate significantly increases the TFP of enterprises,and the result passes several robustness tests;at the same time,the mechanism inspection shows that this process is mainly realized by optimizing the corporate human capital structure and employee's salary structure,improving the investment of corporate fixed assets and R&D investment.In addition,we find that this improvement effect is more significant for private enterprises,large-scale enterprises and manufacturing enterprises.It implies that the government's tax reduction policy can not only increase the output of the enterprise,but also have a certain positive impact in improving people's livelihood,promoting consumption,stabilizing employment,and helping enterprises to transform and upgrade.
social security payment ratetax and fee reductiontotal factor productivity
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