Employment Protection,Human Capital And Production Efficiency

China's economic and social transformation has entered a critical period,and the emergence of problems such as labor and enterprise conflicts affects social harmony and stability.Since implemented in 2008,the labor law has strengthened protection of the legitimate rights and interests of workers,as well as had an impact on business activities.The existing literatures has enriched the economic consequences of the labor law from the perspective of enterprise labor costs and business activities,but there is no relevant evidence on whether the labor law will affect the production efficiency of enterprises and further affect the macro-economy.As the micro foundation of economic development,enterprise productivity growth relates to the sustainable development ability of enterprises and the sustainable growth power of national(regional)economy.Therefore,the impact of labor law on enterprise production efficiency is of great theoretical and practical significance.By analyzing the theoretical mechanism of the impact of labor protection on enterprise production efficiency,this paper argues that,in terms of technological progress,the process of technological progress depends not only on the skill level of the workforce in a particular industry,but also on the ability of enterprises to adjust project human resources and make employment decisions flexibly in response to technological progress.Labor protection makes enterprise dismiss labor cost rise,aggravates the salary stickiness and labor stickiness of enterprise employees,significantly reduces labor flexibility,inhibits the update rate of technology absorption and application,slows down technological progress,and affects the production efficiency of enterprise.Based on the 2003-2016 China A-share non-financial listed companies as samples,based on the CSMAR?CCER?Wind database,using the least squares method(OLS)and half method(OP and LP method)for samples to measure the total factor productivity of the state-owned enterprises.In addition,the framework of "natural experiment" is constructed based on the implementation of the labor law in 2008,and the difference-in-difference method was used for research to test whether and how labor protection affects the production efficiency of enterprises,proposing the following hypothesis to be tested:Hypothesis H1: the implementation of the labor law inhibits the production efficiency of enterprises,which is more significant in enterprises with higher human capital intensity;Hypothesis H2: the inhibiting effect of labor law on production efficiency is more significant in private enterprises;Hypothesis H3: the inhibiting effect of labor law on production efficiency is more significant when the implementation effect of labor contract law is stronger.The empirical results of this paper show that after the implementation of the labor law,labor protection is strengthening,and the production efficiency of enterprises measured by total factor productivity is significantly reduced in human capital-intensive industries.Further analysis shows that this effect is more significant in regions with higher law enforcement efficiency and private enterprises with less soft constraints on employees.Finally,this paper puts forward policy Suggestions for the conclusion,including that enterprises should face up to the impact of labor protection,improve the rate of technological progress and the efficiency of resource allocation,and have a positive impact on total factor productivity.At the same time,the government,as the institution making and implementing party,should also make more objective and real-time assessment of the implementation consequences of the system on enterprises and the economy in the process of promotion,so as to constantly adjust and optimize relevant institutional policies.Because of the universality of the law,this implementation became an exogenous shock to the economy.This paper studies the relationship between labor protection and enterprise production efficiency.Considering the influence of regional difference in law enforcement efficiency and property nature on their correlation,this paper conducts tests on all observation groups in order to discuss the above effects in more depth.The paper also carries out the robustness tests to deal with the problem of missing variables,and the construction of the balance panel.In the process of studying the relationship between labor protection and production efficiency,this paper focuses on the micro behavior of enterprises and expands the depth and breadth of policy research.In recent years,China has witnessed rapid development of patents.However,under the background of rapid growth of patent applications,the level of science and technology has not been improved as expected.This paper provides a possible new explanation for the ineffectiveness of innovation in China from the perspective of the labor contract restraining the productivity of enterprises.