Impact of Minimum Wage Increases on Corporate Social Responsibility
Author Information
Author(s): Wang Hao, Zhang Tao, Wang Xi
Primary Institution: Macao Polytechnic University
Hypothesis
How do minimum wage increases affect corporate social responsibility (CSR) investments?
Conclusion
Minimum wage increases are associated with a reduction in both strategic and responsive CSR, with responsive CSR being affected more significantly.
Supporting Evidence
- Minimum wage increases lead to a significant reduction in CSR investments.
- Firms with higher customer concentration are less responsive to minimum wage increases in their CSR activities.
- Industries with higher CSR sensitivity are more likely to maintain CSR investments despite rising costs.
Takeaway
When minimum wages go up, companies often spend less on their social responsibility efforts, especially on short-term projects.
Methodology
The study used fixed-effects models for panel data analysis of Chinese A-share listed companies from 2010 to 2020.
Limitations
The study's data is limited to publicly listed companies in China and does not account for the impact of COVID-19.
Participant Demographics
Chinese A-share listed companies.
Statistical Information
P-Value
p<0.01
Statistical Significance
p<0.01
Digital Object Identifier (DOI)
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