IDEAS home Printed from https://ideas.repec.org/p/cpr/ceprdp/18080.html
   My bibliography  Save this paper

Does State-Ownership Bias Government Support? Evidence from the Financial Crisis

Author

Listed:
  • Mang, Clarissa
  • Schmidt, Klaus

Abstract

A widely held concern about state ownership is that it leads to inefficient incentive effects and distortions in competition, which could be due to governments supporting firms they own more generously than comparable firms they do not own. Exploiting a unique data set of more than 1600 public, private not-for-profit and private for-profit hospitals in Germany that were eligible to apply for stimulus money during the financial crisis in 2009, we show that state ownership has indeed a causal effect on government support. Public hospitals received significantly and substantially more stimulus money than their private counterparts which cannot be explained by observable characteristics of the hospitals and their environments. Using several different identification strategies we show that hospital ownership is as good as randomly assigned. A simple theoretical model highlights the implications of this result and shows that it can explain many stylized facts about private versus public ownership.

Suggested Citation

  • Mang, Clarissa & Schmidt, Klaus, 2023. "Does State-Ownership Bias Government Support? Evidence from the Financial Crisis," CEPR Discussion Papers 18080, C.E.P.R. Discussion Papers.
    • Handle: RePEc:cpr:ceprdp:18080
    as

    Download full text from publisher

    File URL: https://cepr.org/publications/DP18080
    Download Restriction: CEPR Discussion Papers are free to download for our researchers, subscribers and members. If you fall into one of these categories but have trouble downloading our papers, please contact us at subscribers@cepr.org
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    More about this item

    Keywords

    State ownership;

    JEL classification:

    • I18 - Health, Education, and Welfare - - Health - - - Government Policy; Regulation; Public Health
    • L33 - Industrial Organization - - Nonprofit Organizations and Public Enterprise - - - Comparison of Public and Private Enterprise and Nonprofit Institutions; Privatization; Contracting Out
    • L53 - Industrial Organization - - Regulation and Industrial Policy - - - Enterprise Policy

    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:cpr:ceprdp:18080. 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: the person in charge (email available below). General contact details of provider: https://www.cepr.org .

    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.