Sheng Dan:Can External Regulation Improve the Performance of SOE?

Date of publication:2016-10-18There have been0A reader to read the article

Can External Regulation Improve the Performance of State-owned Enterprises?

Abstract    Using Chinese micro enterprise data, this paper investigates the impact of external regulation on SOE performance and reformation, with the establishment of SASAC as a policy shock. First, we show that strengthening external regulation can increase SOE profit, and the impact is mainly by scale up the production and increasing the production efficiency. Second, strengthening external regulation also generates a positive effect on SOE reformation, which improves the operating performance of restructured enterprises with the fully release of system transformation. Last, strengthening external regulation has a bigger effect on SOE performance in the upstream sector, but it generates a greater effect on SOE reformation in the mid-downstream sector with high market competition. In this paper, we find that strengthening external regulation plays a positive role in SOE reform, but in order to make a further reformation and promote economic growth, the key lies in introducing the market competition mechanism


This paper is published in Economic Research Journal, No.10, 2016.