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Digital transformation and income inequality within enterprises – Evidence from listed companies in China

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  • Li, Minghuan
  • Jiang, Anxuan
  • Ma, Jianteng

Abstract

This study examines the influence of digital transformation on internal income inequality. The findings suggest that enterprise digital transformation has a discernible impact on reducing income inequality between managerial staff and ordinary employees. However, it also leads to an increase in income inequality between high-skilled and low-skilled employees. Mechanism tests reveal that enterprise digital transformation affects income inequality within firms by amplifying investments in research and development (R&D). Furthermore, during corporate digital transformation, a narrower compensation gap between the management and ordinary employees, as well as a wider compensation gap between high-skilled and low-skilled employees, significantly enhance corporate innovation performance.

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  • Li, Minghuan & Jiang, Anxuan & Ma, Jianteng, 2023. "Digital transformation and income inequality within enterprises – Evidence from listed companies in China," Pacific-Basin Finance Journal, Elsevier, vol. 81(C).
    • Handle: RePEc:eee:pacfin:v:81:y:2023:i:c:s0927538x23002044
    DOI: 10.1016/j.pacfin.2023.102133
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    2. Chen, Wen & Zhang, Qiuyue, 2025. "Can corporate climate risk drive digital transformation? Evidence from Chinese heavy-polluting enterprises," Technological Forecasting and Social Change, Elsevier, vol. 212(C).
    3. Xiaohui Xin & Ruoyu Zhu & Guoli Ou, 2025. "Does the opening of high-speed rail speed up the development of urban digital economy?," Economic Change and Restructuring, Springer, vol. 58(2), pages 1-24, April.
    4. Cao, Zhicheng & Tang, Chenxi & Li, Zhicheng, 2025. "The impact of digital transformation on firm risk: Effort by talk or effort by walk," Pacific-Basin Finance Journal, Elsevier, vol. 94(C).
    5. Jingjing Qian & Xiaomin Zhang & Xiang-Wu Yan & Ning Xu, 2024. "Can Information Consumption Promote the Digital Transformation of Enterprises? Empirical Evidence from China," Sustainability, MDPI, vol. 16(24), pages 1-28, December.
    6. Xiao, Zhongyi & Li, Yuanling & Xiang, Cheng, 2025. "Do suppliers value customer firms' digital transformation? Evidence from trade credit provision," International Review of Financial Analysis, Elsevier, vol. 99(C).
    7. Liu, Tingyu & Huang, Peng & Wang, Qiaoru, 2025. "The impact of digital innovation on labor share: Evidence from Chinese firms," International Review of Economics & Finance, Elsevier, vol. 99(C).
    8. Chen, Xi & Wang, Qinggang & Wang, Shuai, 2025. "Enterprise digital transformation and bank credit loans—Empirical evidence from listed companies in China," Pacific-Basin Finance Journal, Elsevier, vol. 90(C).
    9. Zhirui Zhang & Yi Fu & Xiaoyin Liang & Liang Jiang, 2024. "Saying Is Believing: How Do Digital Disclosure Anomalies Affect Corporate Innovation Efficiency," Sustainability, MDPI, vol. 16(24), pages 1-15, December.

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