IDEAS home Printed from https://ideas.repec.org/a/bla/jbfnac/v29y2002i1-2p1-27.html
   My bibliography  Save this article

How Does Government Ownership Affect Firm Performance? Evidence from China’s Privatization Experience

Author

Listed:
  • Qian Sun
  • Wilson H. S. Tong
  • Jing Tong

Abstract

The effect of government ownership on firm performance remains a controversial issue, especially in a transitional economy like China. Government ownership is typically viewed as adversely affecting firm performance. This study of that of Mainland China’s privatization experience indicates the opposite. No matter whether it is in the form of state ownership or legal person ownership, government ownership has a positive impact on partially privatized state‐owned enterprises. However, this relationship is nonlinear and shows an inverted U‐shape. Given the situation of highly indebted, non‐performing state‐owned enterprises, we argue that too much government control is indeed bad for enterprises. But too little government ownership may not be good either. It might mean a lack of the government’s political support and business connections, which are valuable and necessary to vitalize performance.

Suggested Citation

  • Qian Sun & Wilson H. S. Tong & Jing Tong, 2002. "How Does Government Ownership Affect Firm Performance? Evidence from China’s Privatization Experience," Journal of Business Finance & Accounting, Wiley Blackwell, vol. 29(1‐2), pages 1-27.
    • Handle: RePEc:bla:jbfnac:v:29:y:2002:i:1-2:p:1-27
    DOI: 10.1111/1468-5957.00422
    as

    Download full text from publisher

    File URL: https://doi.org/10.1111/1468-5957.00422
    Download Restriction: no
    File URL: https://libkey.io/10.1111/1468-5957.00422?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:bla:jbfnac:v:29:y:2002:i:1-2:p:1-27. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Wiley Content Delivery (email available below). General contact details of provider: http://www.blackwellpublishing.com/journal.asp?ref=0306-686X .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.