The impact of privatization on efficiency and profitability

Over the past three decades, China has undergone tremendous economic and social change as a consequence of the transition from a centrally planned to a market economy. This paper examines a key feature of this transition – the privatization of the state‐owned enterprises (SOEs) – through both a theoretical model and empirical analysis. Using newly collected primary data from a variety of sources, we study how privatization of listed SOEs affects employment, wages, profits and other aspects of economic performance at the firm level. Our major finding is that privatization results in substantial downsizing of employment, increased labour productivity and rising profitability.     

Evaluating Partial Reforms in the Chinese State Industrial Sector: a stochastic frontier cost function approach

China's phenomenal economic growth since 1979 is seen by many as a challenge to the belief that the clarification of property rights is a necessary step of successful transition from a planned economy to a market economy. Instead of mass and rapid privatization, reforms in the Chinese state industrial sector in the 1980s were attempted to reconstruct the incentive structure of enterprises by linking rewards to performance, expanding managerial freedom and exposing enterprises to market influences. This paper investigates the extent to which the partial reforms have transformed the behaviour and performance of state-owned enterprises (SOEs). Using a panel of observations on 769 SOEs from ten manufacturing industries during 1980 and 1989, a stochastic cost frontier function is estimated to measure the effect of various reform measures on both technical and allocative efficiency. We found that the average cost efficiency level increased by 1.18% per annum during the decade. The efficiency effects of the industrial reform programme are mixed. While performance-related bonuses and market competition appear to have had the intended impact, there is evidence that devolution of decision-making power to the firm level has led to deterioration in efficiency. Therefore, although the partial reforms have met with some success, the issue of an adequate structure of incentives for SOEs remains unresolved.     

Industry and Labour: Class Struggle at Work and Monopoly Capitalism; Social Standing in America: New Dimensions of Class; Class Structure and Social Mobility in Poland

A very well-established economic literature maintains that state-owned enterprises (SOEs) are inefficient as compared to privately owned ones (POEs). In this paper, I argue that SOEs' inefficiency is not due to state ownership per se, but is rather caused conditions other than ownership, to which SOEs often — though not necessarily always — relate. In particular, I focus on dynamic efficiency — specifically, the production of technological innovation — of SOEs in manufacturing industries, where SOEs should contend with POEs in a competitive environment. I suggest that targeted measures, which are aimed at increasing managers' commitment to long-term investment strategies and at reducing corruption and political interference — albeit complex and difficult to implement — can be much more (positively) impactful on long-run technical progress than the simple privatization of companies. This leaves room for exploration and implementation of policies that might reconcile state ownership and market competition in industrial sectors.     

经济转轨、跨国公司进入与国有企业改革

任何转轨国家向市场经济过渡都要面临改革与开放的问题.因此,本文在经济开放的背景下,着重突出跨国公司与转轨国家之间经济的紧密联系,建立跨国公司、转轨国家政府、国内企业三者之间的混合寡占博弈模型,并以市场开放、自由化、私有化等政策变量作为影响转轨进程的外生变量,分析开放程度和经济调控手段以及跨国企业的投资策略等对转轨国家国有企业民营化进程和转轨国家国有企业竞争力的影响.研究表明,转轨国家在经济开放的条件下,对国有企业完全民营化并非是改革的最优方案,而对国有企业的部分民营化效果反而会更好,也符合社会福利最大化的原则.而税率、技术、转移价格等也是影响转轨国家社会福利和转轨国家企业产量和竞争能力的重要因素.     

我国国有经济的双重目标与TFP核算的微观基础

本研究主要讨论中国与美国的经济规模比较问题。本研究以1995年为基年,用生产法测算中美货币的双边购买力平价(PPP),并得到中国国际可比的GDP。本文把各研究者对中国国际可比GDP的测算结果外推到2004年,与其他估计相比较,本文对中国国际可比GDP可能提供了一个更合理的估计。在2004年,中国国际可比GDP接近于美国的1/3,而中国的经济规模也超过了日本。研究结果否定了所谓以1000美元为发展阶段划分的论断。在某一年份中国可能具有不同的以美元表示的人均GDP,如2458美元(2003年美元)、523美元(1964年美元)或1241美元(1980年美元)。     

Privatization's impact on private productivity: The case of Brazilian iron ore

A major motivation for the recent wave of privatizations of state-owned enterprises (SOEs) was a belief that privatization would increase SOE productivity. There are now many studies showing most privatizations achieved this goal. Our theme is that the productivity gains from privatization are much more general and widespread than has typically been recognized in this literature. In assessing the productivity gains from privatization, the literature has only examined the productivity gains accruing at the privatized SOEs. But privatization may have significant impact on the private producers that often exist side-by-side SOEs. In this paper we show that this was indeed the case when Brazil privatized its SOEs in the iron ore industry. That is, after their privatization, the iron ore SOEs dramatically increased their labor productivity, but so did the private iron ore companies in the industry.     

MASSIVE DIVESTITURE AND PRIVATIZATION LESSONS FROM CHILE

Between 1974 and 1989, the Chilean government privatized 550 state-owned enterprises (SOEs). Before 1974, all but a handful of major corporations were SOEs. About 50 of the largest enterprises privatized during the 1970s fell into government hands again, only to be re-privatized later. This was due partly to the economic and financial crisis affecting most Latin American countries during the early 1980s but also was a consequence of the privatization modes used. This paper analyzes that unique privatization experience so as to extract policy lessons. The analysis focuses on economic conditions, objectives of government policy, privatization modes, and the divestiture effects on employment, fiscal revenues, public sector wealth, spread of ownership, and capital market development.     

The impact of privatization on firm performance in a transition economy

The Vietnamese privatization programme, launched in 1992, differs from the usual Western privatization programmes in terms of the residual percentage of shares owned by the state and the portion of shares owned by insiders. This begs the question whether these differences influence the effects of the programme on firm performance. This study measures the impact of privatization on firm performance in Vietnam by comparing the pre‐ and post‐privatization financial and operating performance of 121 former state‐owned enterprises (SOEs). We find significant increases in profitability, sales revenues, efficiency and employee income. Results of applying the ‘difference‐in‐difference’ (DID) method, wherein a control group of firms is used to pick up the influence of other determinants of firm performance, suggest that the performance improvements may indeed be associated with equitization. Regression analyses reveal that firm size, residual state ownership, corporate governance and stock market listing are key determinants of performance improvements.     

中国国有企业民营化绩效研究

本文研究中国国有企业民营化是否有效的问题。我们通过对国企民营化进程的考察来对此问题作出经验解答。根据世界银行一份对中国五个城市、覆盖六个行业的近300家国有企业(SOEs)1996—2001年间的调查数据,我们发现:(1)绩效较好的国有企业优先被民营化;(2)总体上来说,中国的民营化是富有成效的,尤其是提高了销售收入,降低了企业的成本,并最终导致企业盈利能力和生产率的大幅提高;而且在获得这些收益的同时并没有带来大规模的失业问题;(3)由民营机构控股、彻底民营化的企业比那些仍然是国有控股、部分民营化的企业绩效表现更好。     

竞争、产权、公司治理三大理论的相对重要性及交互关系

对于国有企业与民营企业间的绩效差异,文献一般从三个理论角度进行研究:竞争、产权与公司治理。但是我们认为其中的各种观点都只强调了某一个方面而忽略了其他方面。本文采用世界银行对中国5大城市7个行业的700多家公司在1996—2001年运营情况的调查数据,分别从单因素效应、多因素效应以及它们之间的相互作用三个方面,对以上三个理论的相对重要性进行了实证研究。研究发现:(1)当分别对各单个因素进行考察时,各因素都对样本公司绩效有积极影响。然而当对这些因素进行综合考察时,我们发现产权结构与公司治理作用相对重要,而竞争效应则不甚显著;(2)在产权与公司治理,以及产权与竞争之间,存在着某种程度的替代性;(3)非国有企业在某些治理机制方面比国有企业显示出特定的优势,但另一方面市场竞争对于国有企业绩效影响大于对非国有企业的影响。研究表明,现有的理论观点都有其片面性,对企业绩效的全面的研究需要将三个理论体系结合起来进行综合考察。我们的研究将对中国正在推行的民营化浪潮,以及改善公司治理和完善市场竞争,都具有重要的政策指导意义。     

政府为什么会放弃国有企业的产权

作为国有资产所有权的代表 ,政府为什么会放弃国有企业的产权 ?已有的经济学文献有两个基本的解释 :一种认为政府放弃国有企业产权的目的在于提高效率 (简称“效率论”) ;而另一种认为政府是出自财政的压力 ,即停止对亏损国有企业的补贴 ,或出售国有资产增加财政收入 (简称“收入论”)。我们的实证研究否定了“效率论” ,而给“收入论”提供了支持。此外 ,我们的研究还为以下结论提供了依据 :政府对失业和降低控制权收益 (来自对国有企业直接的控制权 )的担心是国有企业民营化或破产清算的重大障碍。因此 ,一个简单的含义是 :采用一个将政府目标函数考虑在内的次优民营化或破产清算方案是明智的 ;同时 ,对政府来说 ,这也许比一个无法实施的最优方案更为可行     

Priorities and sequencing in privatization: Evidence from Czech firm panel data

While privatization of state-owned enterprises has been one of the most important aspects of the economic transition from a centrally planned to a market system, no transition economy has privatized all its firms simultaneously. This raises the question of whether governments privatize firms strategically. In this paper we examine the determinants of the sequencing of privatization. To obtain testable predictions about the factors that may affect sequencing, we investigate the following competing government objectives: (i) Maximizing efficiency through resource allocation; (ii) maximizing public goodwill from the free transfers of shares to the public; (iii) minimizing political costs; (iv) maximizing efficiency through information gains; and (v) maximizing privatization revenues. Next, we use firm-level data from the Czech Republic to test the competing predictions about the sequencing of privatization. Consistent with the hypotheses of a government priority on revenues and public goodwill, we find strong evidence that more profitable firms were privatized first. The sequencing of privatization is also consistent with maximizing efficiency through information gains. Our results indicate that many empirical studies of the effects of privatization on firm performance suffer from a selection bias.     

公、私制企业效率工资的比较研究

造成国有、私营企业绩效差异的一个很重要原因是二者生产效率的巨大差异。造成国有、私营企业生产效率巨大差异的主要原因是国有企业不能解雇工人的劳动用工制度。国有企业的目标多元化要求其必须对稳定社会就业承担责任,即不能解雇工人,但这给国有企业对工人的管理激励带来很大困难,造成生产效率低下的严重后果。     

From central planning towards a market economy: The role of ownership and competition in Vietnamese firms’ productivity

This paper examines the role of ownership and market competition in Vietnamese firms’ total factor productivity (TFP) from 2001 to 2011. Making use of a large panel dataset of manufacturing firms, we find that, on average, both foreign-owned enterprises (FOEs) and state-owned enterprises (SOEs) have performed better than privately owned enterprises (POEs) in terms of their TFP levels. However, while FOEs’ TFP ranked the highest in the period 2001–2006, SOEs “closed the gap” in the period 2007–2011. Moreover, we find that market competition has been effective in enhancing average firm productivity and in reducing the gaps in efficiency across ownership types. SOEs’ remarkable performance may be linked to several concurrent factors experienced during the period 2001–2011, namely, the process of restructuring the state sector during the 2000s, the increased economic integration due to the country's accession to the World Trade Organization (2007) and, finally, the preferential access to financial capital and land granted to SOEs. While some evidence supports SOEs’ equitization as an explanation for their remarkable productivity performance, WTO accession and cheaper access to inputs do not fully explain it.     

The economic performance of state-owned enterprises in Central and Eastern Europe

This article explores the economic performance of state ownership in the largest non-financial enterprises operating in 13 post-socialist Central and Eastern European (CEE) countries over the period 2007–2013. The largest state-owned enterprises (SOEs) are selected based on the ‘Coface – 500 Top Companies in CEE’ list in 2013. Of these 500 enterprises, 69 were identified as state-owned. All originated in the socialist period. The majority of them are from Poland and Ukraine. SOEs hold a dominant position in energy supply, the oil and gas sector, and transport. We find that the persistence of state ownership in post-socialist countries is caused by incomplete privatisation and the presence of SOEs within strategic sectors. The economic performance of the largest state-owned companies is, on average, comparable to their private counterparts.     

Corruption and privatization: Evidence from a natural experiment in China

This paper investigates how government corruption shapes state-owned enterprises' (SOEs) privatization. To establish causality, we exploit a natural experiment (i.e., the investigations of the Central Commission for Discipline Inspection) to document that SOEs significantly deepen privatization after the crackdown on corruption. Further evidence demonstrates two plausible mechanisms driving our findings. Specifically, anti-corruption campaign: 1) accelerates privatization process by curbing the underpricing transfers to state entities and encouraging the normal transfers to private entities or individuals; and 2) by reducing managers' incentives to maintain the dominance of state ownership for expropriation through the discretion of perk consumption. Moreover, our findings are particularly pronounced for SOEs located in areas with high levels of social trust, government intervention, and less information asymmetry.     

为何改革没有提高国有企业的相对劳动生产率

本文用一个国有企业工资和就业决定模型为不同所有制企业间劳动生产率差距越来越大的现象提供了一个理论解释。本文认为,在国有企业的工资和就业决定受到管制的情况下,一些通常被认为有效的改革措施(如提高管理者固定收入和利润分成比率)反而会阻碍企业重构。另外,在改革过程中,国有企业的产值份额越来越小,但其就业份额却仍然非常之大,这就使得政府更加强调国有企业稳定社会的功能。因此,放松管制对于成功的市场化改革和企业重构而言是至关重要的。     

国有工业企业简单控制型的劳动关系分析

本文以四家国有工业企业为研究样本,分析了转制后国有工业企业存在的简单控制型劳动关系。这种劳动关系表现为企业目标已经转变为绩效目标,国有企业劳动关系主体等级化,经营管理者与国家保持着紧密的联系,得到其政治与经济的双重庇护,并具有绝对支配权;技术人员有明确的市场优势,却是个体化和碎片化的;技术工人虽享有传统国有企业的保护,但却呈现老龄化趋势,后继乏人;而大量低价非正规劳动力的使用使等级化的用工模式达到极端。简单控制型的劳动关系与非正规劳动力市场有着重要的依存关系,它有效地瓦解了工会的作用,并使固定工以及劳务工们在市场中碎片化。     

Does Autonomy Matter in State Owned Enterprises? Evidence from Performance Contracts in India

Empirical evidence on the effect of managerial autonomy on the performance of state‐owned enterprises (SOE) is surprisingly scant despite autonomy being a preferred reform instrument over partial privatization in many countries. Using longitudinal data on performance contracts of state‐owned enterprises in India, this paper finds that managerial autonomy is associated with significant increases in enterprise profitability and efficiency. Further, using India's unique reform experience where both managerial autonomy and partial privatization were pursued side by side, the paper finds that while the positive effects of autonomy continue post‐partial privatization, the effects of partial privatization on performance are ambiguous. Specifically, once autonomy is controlled for, partial privatization has a positive effect on SOE profitability only after it crosses a critical level of government disinvestment. The findings suggest that organizational reforms such as granting managerial autonomy can be an important policy instrument in improving SOE performance particularly in cases where governments are unable to make substantial disinvestments.     

双轨制、价格市场化与总量投资分析

本文在新古典投资理论的框架下引入中国转轨时期的制度性因素,建立包括私有部门、国企部门以及政府部门的投资行为模型,论证了国有企业多重目标而导致其过度投资和资本积累,同时解释了在转轨过程中出现的诸如"国退民进"等演化现象,论证了政府倾向于干预经济,施行"逆风向行事"规则,然而因其对项目真实利润的不可准确估测性会导致投资的过度波动,从而表明政府投资可能是经济中投资波动的来源。