Does digital supply chain management affect labor share? Firm-level evidence

Purpose This study aims to contribute novel insights into assessing the socioeconomic impact of digitalization from the perspective of income distribution. The research purposes of this study include identifying the causal relationship between digital supply chain management (DSCM) and labor share, influencing mechanisms and the heterogeneous impacts. Design/methodology/approach The DSCM has emerged as a transformative trend amid the global wave of digital transformation, yet its socioeconomic consequences remain underexplored. Using the quasi-natural experiment and firm-level microdata, this study evaluates the impact of enterprise DSCM on labor share. A difference-in-difference approach is used in this study. Findings This study finds that DSCM significantly reduces the labor share, and this effect operates through intensifying capital deepening, enhancing market power and squeezing out the income share of low-skilled groups. Heterogeneity analysis further reveals that the negative effect of DSCM on labor share is more pronounced among firms with higher levels of supply chain financialization, greater supply chain stability and stronger supply chain concentration. Research limitations/implications One limitation of this study lies in the fact that it only encompasses data from listed companies. In future research, with the increase in data availability, more companies, including small and medium-sized enterprises (SME) samples, can be selected for further investigation. In addition, this study uses Chinese enterprises as samples. In subsequent research, samples from more countries and regions can be chosen to provide more abundant evidence regarding the impact of DSCM on the labor share. Practical implications In the process of supply chain digitalization, policymakers should therefore strive to achieve a better balance between efficiency and equity. Strengthening regulatory and institutional frameworks for digitalization is essential to prevent excessive supply chain financialization and concentration from further eroding labor share. Measures such as antitrust enforcement, improved data governance and greater supply chain transparency may help ensure that the benefits of digitalization are more properly distributed across enterprises and labor groups. Originality/value The originality of this manuscript is reflected in these following aspects: first, to fill the research gap on the impact of DSCM on labor share and enrich the theoretical framework of the socioeconomic effects of digital transformation; second, to reveal the core factor and specific pathways of DSCM on labor share through empirical analysis, providing a scientific basis for policy formulation; third, to explore the heterogeneous impacts of DSCM in different contexts, offering differentiated guidance for the digital transformation practices of enterprises.