Cities’ low-carbon transformation and labor income share of companies: evidence from the low-carbon city pilot program in China

• Published in: Environmental science and pollution research international Vol. 30; no. 47; pp. 104672 - 104686
• Main Authors: Liu, Qiongzhi, Li, Renke
• Format: Journal Article
• Language: English
• Published: Berlin/Heidelberg Springer Berlin Heidelberg 01.10.2023; Springer Nature B.V
• Subjects: Aquatic Pollution; Atmospheric Protection/Air Quality Control/Air Pollution; Carbon; Carbon content; Carbon dioxide; Cities; Earth and Environmental Science; Economic growth; Ecotoxicology; Emission standards; Emissions; Employees; Environment; Environmental Chemistry; Environmental effects; Environmental Health; Environmental policy; Environmental regulations; Human capital; Income; Income distribution; Inequality; Labor; Labor economics; Labor force; Pilot projects; Policies; Pollution; Productivity; Regulation; Research Article; Sustainable development; Wages & salaries; Waste Water Technology; Water Management; Water Pollution Control; Low-carbon city pilot program; Resource-based city; High-skilled workers; Corporate financialization; Staggered DID; Labor income share
• ISSN: 1614-7499; 0944-1344; 1614-7499
• DOI: 10.1007/s11356-023-29729-6

This article investigates the impact of the low-carbon city pilot program on income distribution. The program is designed to reduce urban carbon emissions in China while also serving as a quasi-natural experiment to examine the income distribution effect of environmental regulatory policies. Using the firm-year level data during 2007–2020, we adopt the staggered difference-in-difference method to explore the impact of the program on labor income share. This study finds that the LCCP program significantly affects firms’ labor income share. The proportion of highly educated employees and the level of financialization within the firm act as mediators that influence labor income share. This paper suggests that government should use reasonable environmental regulatory policy to facilitate labor income share to alleviate inequality, promote the scope of the program to more cities, and help firms to improve human capital level as well as serve more financial policies.