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Impact of privatization on firm performance in Vietnam: A Staggered Difference-in-Differences analysis with heterogeneous treatment effects

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  • Quang Minh Nguyen

    (Universitat de Valencia)

Abstract

This study contributes to the empirical literature on the effects of privatization on the financial and operating performance of former state-owned enterprises (SOEs) and offers evidence on the heterogeneity of these effects across multiple dimensions. Utilizing a sample comprising 770 privatized SOEs and 2,154 non-privatized SOEs in Vietnam from 2006 to 2010, I conduct a staggered diff-in-diff estimation to identify the causal impact of privatization on firm's performance. The results reveal that, on average, privatizaion led to an increase of 5% in sales per worker, a 23-27% increase in profitability measures, and 8% decrease in debt ratio, and a 5% decline in total employment. However, little changes in post-privatization performance are observed for large SOEs, strategic SOEs, and service SOEs.

Suggested Citation

  • Quang Minh Nguyen, 2023. "Impact of privatization on firm performance in Vietnam: A Staggered Difference-in-Differences analysis with heterogeneous treatment effects," Documentos de Trabajo EH-Valencia (DT-EHV) 2303, Economic History group at the Universitat de Valencia.
    • Handle: RePEc:bci:wpaper:2303
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    More about this item

    Keywords

    Privatization; firm performance; staggered difference-in-differences; heterogeneous treatment effects;
    All these keywords.

    JEL classification:

    • N25 - Economic History - - Financial Markets and Institutions - - - Asia including Middle East
    • G34 - Financial Economics - - Corporate Finance and Governance - - - Mergers; Acquisitions; Restructuring; Corporate Governance
    • L33 - Industrial Organization - - Nonprofit Organizations and Public Enterprise - - - Comparison of Public and Private Enterprise and Nonprofit Institutions; Privatization; Contracting Out
    • P31 - Political Economy and Comparative Economic Systems - - Socialist Institutions and Their Transitions - - - Socialist Enterprises and Their Transitions

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