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Social security contributions, labor income share, and corporate innovation

Author

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  • Li, Tongbin
  • Gao, Juan

Abstract

Corporate innovation is regarded as a key driver of economic growth and technological progress. This paper uses panel data from Chinese listed companies for the period 2009–2023 to assess the impact of social security contributions on corporate innovation. The results show that social security contributions can effectively promote corporate innovation. Specifically, social security contributions positively affect corporate innovation by enhancing human capital intensity, and a higher labor income share strengthens the positive impact of social security contributions on corporate innovation. The findings have important theoretical and practical implications for promoting China's innovation-driven development strategy.

Suggested Citation

  • Li, Tongbin & Gao, Juan, 2025. "Social security contributions, labor income share, and corporate innovation," Finance Research Letters, Elsevier, vol. 77(C).
    • Handle: RePEc:eee:finlet:v:77:y:2025:i:c:s1544612325003861
    DOI: 10.1016/j.frl.2025.107123
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    Keywords

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    JEL classification:

    • H55 - Public Economics - - National Government Expenditures and Related Policies - - - Social Security and Public Pensions
    • J33 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Compensation Packages; Payment Methods
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • L26 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Entrepreneurship

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