Prof. Xiong Jicai's Team Publishes Research in Prestigious Journal "Systems Engineering Theory & Practice"

Recently, Professor Xiong Jiacai and doctoral candidate Huang Ling jointly completed the paper "Local fiscal pressure and labor income share: A quasi-natural experiment analysis based on agricultural taxes abolition reform" published in the authoritative domestic journal "Systems Engineering-Theory & Practice" 2025 issue 4.

Increasing labor income share is the core essence of optimizing the income distribution pattern and achieving common prosperity. This paper examines the impact of local fiscal pressure on the labor income share of enterprises using difference-in-difference method with a quasi-natural experiment of the nation-wide abolition of agriculture tax in 2005. We find that local fiscal pressure significantly reduces the share of labor income of enterprises. Moreover, we find that the negative relationship is more pronounced in small and medium-sized enterprises, regions with lower financial development, regions with lower fiscal self-sufficiency, and firms in labor-intensive industries. Further mechanism analysis shows that fiscal pressure leads local governments to raise tax and non-tax enforcement, increase debt raising, and thus intensify firms' financing constraints. Financing constraints firms cut human capital investment to smooth out fixed asset investment, which in turn leads to a decrease in firms' labor income share. This study not only enriches the research on local fiscal pressure and labor income share of enterprises, but also provides empirical evidence and policy implications on how to improve the primary distribution structure and achieve common prosperity.

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"Systems Engineering - Theory & Practice" is a professional academic journal sponsored by the Chinese Society of Systems Engineering. It is recognized as an authoritative domestic A-class journal by our university, and also as an important A-class journal by the Management Science Department of the National Natural Science Foundation of China and A T1-level journal in the FMS high-quality Management Science journal recommendation list.