Fast-paced digitization is affecting all aspects of life, including the way we trade. This study empirically analyzes the influence and mechanism of digital service trade on labor income share using 48 countries’ panel data from 2005 to 2019. The research results show that digital service trade has a positive effect on labor income share. Specifically, the impact of digital service trade on labor income share includes productivity effect, structural effect, and distribution effect. The results also show that the export of digital service trade is more conducive to increasing domestic labor income share than the import. The positive impact of digital service trade on labor income share in OECD countries is more significant than in non-OECD countries. At the same time, the digital service trade’s income distribution effect has heterogeneity due to differentiated national digital service trade barriers’ level. This paper discusses theoretically and empirically the impact of digital service trade on the share of labor income for the first time, and puts forward policy suggestions on formulating more open and win-win digital service trade policies, improving labor income, and promoting social equity and inclusive global trade.

This study utilises panel data of 46 countries from 2005 to 2019 to examine the impact of digital service trade (DST) on inclusive growth. Inclusive growth is a growth model that promotes economic growth and development, while also building social equity and inclusiveness and balancing environmental sustainability. The findings indicate that a nation’s DST development significantly fosters domestic economic growth and development, specifically through its employment enhancement effect. DST substantially promotes social equity and inclusiveness, mainly through the inclusive innovation effect. However, DST is also found to increase carbon emissions, impeding environmentally sustainable growth, specifically via the energy demand effect. Hence, DST exerts diverse impacts on different facets of inclusiveness. The study also reveals heterogeneity in the effects of DST on the three aspects of inclusive growth related to trade’s import–export dynamics, income levels, and DST barrier intensities. This paper contributes to and refines the body of research on the relationship between DST and inclusive growth. It offers policy suggestions for crafting more open and mutually beneficial DST policies to foster social equity and inclusive global trade.

The study is based on data from Chinese listed companies and explores the impact of a company’s position in the global value chain (GVC) on internal wage distribution and income inequality. The results show that although the improvement of GVC status in enterprises has increased the average salary level of all employees, it has exacerbated the wage gap between management and grassroots employees, leading to widening income inequality, mainly achieved through rent-sharing mechanisms. In addition, companies with higher human capital can alleviate the income inequality effect caused by the rise of GVC status. Further analysis reveals that the impact of GVC status on internal income inequality in enterprises is heterogeneous regarding property rights, employee bargaining power, and enterprise size. The study provides a new perspective on exploring the income distribution effects of the GVC from a micro perspective, emphasising that enterprises need to pay attention to building a fair and reasonable income distribution structure while being open to others at a high level. It is significant for promoting the construction of micro-mechanisms based on enterprises, fostering social equity and inclusive growth.