Labor Income Share and Household Consumption Inequality: From the Perspective of Skill Differences
MAO Linglin1,2, GUO Xinhua1
1. Business School, Xiangtan University, Xiangtan 411105, China; 2. School of Economics and Management, Hunan University of Arts and Science, Changde 415000, China
Abstract Based on the data from the China Household Finance Survey ( CHFS ) and in combination with the provincial input-output tables of 2012 and 2017, this study systematically examines the impact of industry labor income share on household consumption inequality and its mechanism, and assesses how skill differences moderates the relationship. The research findings are as follows: Firstly, an increase in the industry's labor income share can effectively reduce household consumption inequality. This conclusion remains robust after a series of tests, including replacing the explained variable, the explanatory variable and considering endogeneity issues; Secondly, the share of industry labor income has more significant inhibitory effect on consumption inequality in the central and western regions, regions with low human capital levels, regions with low artificial intelligence levels, families employed in non-state-owned enterprises, and families with a low proportion of non-wage income; Thirdly, skill differences can regulate the relationship between the share of labor income and household consumption inequality. The increase in the share of labor income will widen the consumption gap among highly skilled workers within the industry, while significantly narrowing the consumption inequality among low-skilled workers. The research findings contribute to understanding the differentiated impact of labor income share growth on household consumption inequality and its underlying mechanisms, offering policy insights for optimizing factor distribution structuresand promoting common prosperity in the new development phase.
MAO Linglin,GUO Xinhua. Labor Income Share and Household Consumption Inequality: From the Perspective of Skill Differences. Economic Survey, 2025, 42(6): 016.
2025, Vol. 42 
