Digital Gains: FinTech Development and Labour Share

Cao, Y; Lu, M; Shan, Y; Zhang, Z; Zu, Y

Digital Gains: FinTech Development and Labour Share

Cao, Y Lu, M Shan, Y

Zhang, Z Zu, Y

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Publisher:: WILEY
Publication Type:: Journal Article
Citation:: Accounting and Finance, 2025
Issue Date:: 2025-01-01

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Field	Value	Language
dc.contributor.author	Cao, Y
dc.contributor.author	Lu, M
dc.contributor.author	Shan, Y https://orcid.org/0000-0003-2156-8722
dc.contributor.author	Zhang, Z
dc.contributor.author	Zu, Y
dc.date.accessioned	2025-07-25T02:21:58Z
dc.date.available	2025-07-25T02:21:58Z
dc.date.issued	2025-01-01
dc.identifier.citation	Accounting and Finance, 2025
dc.identifier.issn	0810-5391
dc.identifier.issn	1467-629X
dc.identifier.uri	http://hdl.handle.net/10453/188822
dc.description.abstract	Capital market development and technological innovation affect the labour income share and resource allocation, but the link between financial innovation and the labour share remains unclear. This paper examines the labour income share through the lens of financial innovation. Using the Bartik (1991) instrumental variable approach and a difference-in-differences estimation, we document a positive and casual relationship between local FinTech development and the labour income share among Chinese firms. Mechanism analyses suggest local FinTech development alleviates financing constraints, optimises resource allocation and improves the structure of human capital, leading to a higher labour income share of firms. The positive effects of local FinTech development are stronger for firms in industries or regions with inefficient resource allocation, for smaller non-state-owned enterprises and for firms with greater access to educational resources. Overall, our results highlight the role of FinTech development in improving capital allocation efficiency, shaping the distribution of labour and enhancing social welfare.
dc.language	English
dc.publisher	WILEY
dc.relation	http://purl.org/au-research/grants/arc/DP210101354
dc.relation	http://purl.org/au-research/grants/arc/DP210101004
dc.relation.ispartof	Accounting and Finance
dc.relation.isbasedon	10.1111/acfi.70039
dc.rights	info:eu-repo/semantics/openAccess
dc.subject	1402 Applied Economics, 1501 Accounting, Auditing and Accountability, 1502 Banking, Finance and Investment
dc.subject.classification	Accounting
dc.subject.classification	3501 Accounting, auditing and accountability
dc.subject.classification	3502 Banking, finance and investment
dc.subject.classification	3801 Applied economics
dc.title	Digital Gains: FinTech Development and Labour Share
dc.type	Journal Article
utslib.for	1402 Applied Economics
utslib.for	1501 Accounting, Auditing and Accountability
utslib.for	1502 Banking, Finance and Investment
pubs.organisational-group	University of Technology Sydney
pubs.organisational-group	University of Technology Sydney/Business School
pubs.organisational-group	University of Technology Sydney/Business School/Accounting Discipline
utslib.copyright.status	open_access	*
dc.rights.license	This work is licensed under a Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 International License (CC BY-NC-ND 4.0). To view a copy of this license, visit https://creativecommons.org/licenses/by-nc-nd/4.0/
dc.date.updated	2025-07-25T02:21:57Z
pubs.publication-status	Published

Abstract:

Capital market development and technological innovation affect the labour income share and resource allocation, but the link between financial innovation and the labour share remains unclear. This paper examines the labour income share through the lens of financial innovation. Using the Bartik (1991) instrumental variable approach and a difference-in-differences estimation, we document a positive and casual relationship between local FinTech development and the labour income share among Chinese firms. Mechanism analyses suggest local FinTech development alleviates financing constraints, optimises resource allocation and improves the structure of human capital, leading to a higher labour income share of firms. The positive effects of local FinTech development are stronger for firms in industries or regions with inefficient resource allocation, for smaller non-state-owned enterprises and for firms with greater access to educational resources. Overall, our results highlight the role of FinTech development in improving capital allocation efficiency, shaping the distribution of labour and enhancing social welfare.

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http://hdl.handle.net/10453/188822