Abstract
This paper analyses the impact of privatisation on firm performance in China. Privatisation has had a significantly positive impact on firm profitability, but has had a weak or insignificant impact on unit costs and labour productivity. Increasing private share ownership has had a positive effect on profitability but only under the condition that the proportion of private share ownership passes a certain threshold. The presence of external share ownership has both statistically and economically significant effects on profitability, labour productivity and to a lesser extent, on unit costs. When there is no external share ownership, it takes time for an internally privatised/ gaizhi-ed firm to overcome the inertia inherited from being a former state enterprise. For gaizhi (enterprise restructuring) to be effective in improving firm performance, it has to be connected with a certain degree of privatisation.
| Original language | English |
|---|---|
| Title of host publication | Globalisation And Economic Growth In China |
| Publisher | World Scientific Publishing Co |
| Pages | 59-112 |
| Number of pages | 54 |
| ISBN (Electronic) | 9789812773234 |
| DOIs | |
| Publication status | Published - 1 Jan 2006 |