The Impact Of Outward Foreign Direct Investment On Labor Income Share Of Enterprises

The impact of the COVID-19 epidemic has led to a sharp decline in global foreign direct investment activities.However,China’s foreign direct investment has increased against the trend in 2020,which not only provides impetus for the recovery of the world economy,but also demonstrates the ability and determination of Chinese enterprises to "go global".The growth of Chinese enterprises’ foreign direct investment not only helps to expand the market space,integrate overseas factor resources,optimize the allocation of internal production factors,but also enhance the international competitiveness of enterprises.With the growth of Chinese enterprises’ foreign direct investment,its impact on domestic economic and social issues,including employment and labor income,is worthy of great attention and in-depth study.This paper attempts to analyze the influence and mechanism of labor income share of enterprises by discussing the economic benefits and technological changes brought about by Chinese enterprises’ foreign direct investment.This paper reviews the research related to foreign direct investment and labor income share of enterprises,expounds the current situation of foreign direct investment and labor income share of enterprises from the macro and micro levels respectively,theoretically analyzes the path of the influence of foreign direct investment on labor income share of enterprises,and attributes the influence of foreign direct investment on labor income share of enterprises to the difference between "salary effect" and "labor productivity effect".At the same time,this paper further analyzes the influence mechanism of foreign direct investment on labor income share of enterprises from the perspective of heterogeneous investment motivation.In the empirical research,this paper selects Chinese A-share listed companies from 2007 to 2015 as the research sample,uses the propensity score matching method and difference-in-difference method to test the impact of foreign direct investment on labor income share.The results show that:(1)OFDI will significantly increase the share of labor income of enterprises,but its dynamic impact is weak,covering only the current period and the next period.(2)Foreign direct investment acts on labor income share of enterprises through the difference between "salary effect" and "labor productivity effect".Through empirical test,it is found that "salary effect" is not completely offset by "labor productivity effect".Therefore,foreign direct investment has a positive impact on the share of labor income.(3)The heterogeneity of the influence of foreign direct investment on labor income share is obvious.After distinguishing the industry,the nature of ownership and the nature of the host country,it is found that the foreign direct investment of enterprises belonging to the secondary industry,private enterprises,and enterprises investing in developed countries and regions can significantly increase the share of labor income.(4)From the perspective of heterogeneous investment motivation of foreign direct investment,except that resource-seeking foreign direct investment has no obvious influence on labor income share of enterprises,market-seeking,efficiency-seeking and strategic capital-seeking foreign direct investment significantly increases the labor income share of enterprises.Finally,in order to make enterprises’ foreign direct investment continuously improve the labor income share of enterprises,make labor elements become the core competitiveness of enterprises,and enhance the welfare treatment of workers,the conclusion of this paper puts forward three targeted suggestions to the Chinese government and enterprises:(1)the government should continue to support enterprises’ foreign direct investment from the aspects of system construction,policy guidance and diplomatic coordination,optimize the industrial layout and location layout of foreign direct investment,and cultivate high-quality multinational enterprises.(2)the government implements differential support measures in the policy support of foreign direct investment,and gives tax and financial policy support to foreign direct investment enterprises that have good protection of labor rights and interests and take the initiative to undertake the responsibility of common prosperity.(3)Enterprises should fully tap and make full use of overseas resources,increase investment in R & D and innovation,improve the talent structure,increase the share of labor income,and make human resources become the core competitiveness.