Mixed ownership reform, political connections, and overinvestment
Bibliographic Data
| ID | 2802545 |
|---|---|
| Authors | Jizhou Wang (0009-0009-5086-6500, South China Business College Guangdong University of Foreign Studies Guangzhou China), Jin’an He (0000-0002-1980-2711, School of Business Sun Yat‐Sen University Guangzhou China, corresponding author), Richard Cebula (0000-0002-0867-4400, Haslam College of Business University of Tennessee Tennessee Knoxville USA), Michael Foley (0000-0002-0900-9509, Davis College of Business and Technology Jacksonville University Florida Jacksonville USA), Fangping Peng (0000-0001-7689-5435, School of Business Sun Yat‐Sen University Guangzhou China, corresponding author) |
| Year | 2024 |
| Volume | 83 |
| Issue | 2 |
| Pages | 407-425 |
| Publication date | 2024-03-01 |
| Peer Reviewed | Yes |
| Open Access | Yes |
| Type | ARTICLE |
| Venue | American Journal of Economics and Sociology (JOURNAL) |
| Journal identifiers | ISSN: 0002-9246 • E-ISSN: 1536-7150 |
| Publisher | Wiley (PUBLISHER • GB) |
| DOI | 10.1111/ajes.12549 |
| OpenAlex | W4387648729 |
| Language | EN |
| References cited | 22 |
The study discovers that mixed ownership reform aimed at enhancing the performance and resource allocation efficiency of state-owned enterprises may have unintended consequences in China. When the nature of state-owned control remains unchanged, there is a risk of increased overinvestment due to misaligned interests between state-owned equity representatives and companies. This incentive can be mitigated by introducing nonstate shareholders with political connections. The study employs a double machine learning method to analyze data from state-owned listed companies that introduced nonstate shareholders through stock issuance between 2008 and 2019. The research underscores that modern corporate governance mechanisms are crucial for successful mixed ownership reform
Business · China · Corporate governance · Economics · Emerging markets · Equity (law) · Incentive · Market economy · Political science · Politics · Shareholder · State (computer science) · State ownership · Stock (firearms) · Unintended consequences · Accounting · Corporate Finance and Governance · Finance · Law · Political Influence and Corporate Strategies · Private Equity and Venture Capital
Over-investment of free cash flow
Double/debiased machine learning for treatment and structural parameters
Political connections and preferential access to finance
How does financial reporting quality relate to investment efficiency?
Bank discrimination in transition economies
Local financial development and constraints on domestic private-firm exports
| Citation velocity | historical |
|---|---|
| Highly cited | No |