The Relationship between Ownership Identity, Ownership Concentration, and Firm Performance: Evidence from China

The Relationship between Ownership Identity, Ownership Concentration, and Firm Performance: Evidence from China

Krishna Reddy

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The Relationship between Ownership Identity, Ownership Concentration, and Firm Performance: Evidence from China

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Abstract

This study compares the performance of stateowned firms, local government SOEs, and privately-owned firms in China. Using panel data comprising 13,273 firm-year observations for the period 2005-2012 and OLS, 2SLS, and difference-in-difference regression, we report that the identity of the largest shareholder does matter. Our results show that the listed, central government-owned SOEs’ operating costs are similar to those of local government owned SOEs and privately-owned firms. Our results suggest that ownership concentration matters in China, that is, central government shareholding is an important determinant of state owned firms’ performance. The policy implication of this study is that helping-hand and protectionist policies have helped stateowned firms to prosper in by creating an uncompetitive market and ineffective legal infrastructure.

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No external funding was declared for this work.

Conflict of Interest

The authors declare no conflict of interest.

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No ethics committee approval was required for this article type.

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How to Cite This Article

Krishna Reddy. 2026. \u201cThe Relationship between Ownership Identity, Ownership Concentration, and Firm Performance: Evidence from China\u201d. Global Journal of Management and Business Research - A: Administration & Management GJMBR-A Volume 22 (GJMBR Volume 22 Issue A8): .

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GJMBR Volume 22 Issue A8
Pg. 9- 32

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Crossref Journal DOI 10.17406/GJMBR

Print ISSN 0975-5853

e-ISSN 2249-4588

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GJMBR-A Classification: GEL Classifications: G28, G38

Submission ReceivedOctober 6, 2022
Peer Review Double Blind
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Accepted October 13, 2022
Published November 11, 2022

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