公司研究论文



Abstract

Based on a large-scale nationwide survey of Chinese firms, this paper conducts a
systematic study of China’s privatization. Our results show that, although the government has
greatly retreated from key corporate decisions after privatization, it still retains substantial control
in about half of the firms and such state control is related to weaker efficiency gain. Among
different privatization methods, direct sales to insiders or MBOs, which account for close to half of
all privatization programs, are the most successful in freeing the firms from government influence
and in implementing restructuring measures. We find that the political constraints faced by the
government critically determine its choices of privatization methods. Specifically, the government
is more likely to choose the MBO method when political opposition to layoffs are weaker in the
region or when they have more fiscal resources to bear the cost of layoffs and to fill the gap in
social welfare created by privatization. Consistent with their effectiveness in reallocating control
rights and in implementing post-privatization restructuring, MBOs are associated with the most
efficiency gain, as measured by both earnings over assets and earnings per employee. In contrast,
direct sales to outsiders and other privatization methods do not improve efficiency. Our results
highlight the importance of political factors in shaping the design of economic institutions and
their performance.