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Article: Corporate governance and firm efficiency: Evidence from China's publicly listed firms
Title | Corporate governance and firm efficiency: Evidence from China's publicly listed firms |
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Authors | |
Issue Date | 2009 |
Publisher | Wiley. The Journal's web site is located at http://onlinelibrary.wiley.com.eproxy1.lib.hku.hk/journal/10.1002/(ISSN)1099-1468 |
Citation | Managerial and Decision Economics, 2009, v. 30 n. 3, p. 193-209 How to Cite? |
Abstract | This paper applies a two-stage, double bootstrapping data envelope analysis approach to investigate whether and to what extent various distinctive corporate governance practices affect productive efficiency in a sample of 461 publicly listed manufacturing firms in China between 1999 and 2002. We find that firm efficiency is negatively related to state ownership while positively related to public and employee share ownership. In addition, the relationship between ownership concentration and firm efficiency is U-shaped, indicating the presence of tunneling activities by the largest shareholder. Among three types of controlling shareholder, state exerts the most negative impact on firm efficiency, followed by state-owned legal entities. These results provide strong evidence that political interferences have reduced firm efficiency. It shows that the proportion of outside directors and the number of board meetings are positively associated with firm efficiency, suggesting that board of directors can be an effective internal governance mechanism. Furthermore, provincial market development, a proxy for the strength of external governance mechanism, is positively related to firm efficiency. Overall, our findings illustrate that restructuring state-owned enterprises via improvements in corporate governance has enhanced firm efficiency, but partial privatization without transfer of ownership and control from the state to the public remains a major source of inefficiency in corporate China. Copyright © 2008 John Wiley & Sons, Ltd. |
Persistent Identifier | http://hdl.handle.net/10722/192330 |
ISSN | 2023 Impact Factor: 2.5 2023 SCImago Journal Rankings: 0.555 |
ISI Accession Number ID |
DC Field | Value | Language |
---|---|---|
dc.contributor.author | Lin, C | en_US |
dc.contributor.author | Ma, Y | en_US |
dc.contributor.author | Su, D | en_US |
dc.date.accessioned | 2013-10-24T01:49:58Z | - |
dc.date.available | 2013-10-24T01:49:58Z | - |
dc.date.issued | 2009 | en_US |
dc.identifier.citation | Managerial and Decision Economics, 2009, v. 30 n. 3, p. 193-209 | en_US |
dc.identifier.issn | 0143-6570 | en_US |
dc.identifier.uri | http://hdl.handle.net/10722/192330 | - |
dc.description.abstract | This paper applies a two-stage, double bootstrapping data envelope analysis approach to investigate whether and to what extent various distinctive corporate governance practices affect productive efficiency in a sample of 461 publicly listed manufacturing firms in China between 1999 and 2002. We find that firm efficiency is negatively related to state ownership while positively related to public and employee share ownership. In addition, the relationship between ownership concentration and firm efficiency is U-shaped, indicating the presence of tunneling activities by the largest shareholder. Among three types of controlling shareholder, state exerts the most negative impact on firm efficiency, followed by state-owned legal entities. These results provide strong evidence that political interferences have reduced firm efficiency. It shows that the proportion of outside directors and the number of board meetings are positively associated with firm efficiency, suggesting that board of directors can be an effective internal governance mechanism. Furthermore, provincial market development, a proxy for the strength of external governance mechanism, is positively related to firm efficiency. Overall, our findings illustrate that restructuring state-owned enterprises via improvements in corporate governance has enhanced firm efficiency, but partial privatization without transfer of ownership and control from the state to the public remains a major source of inefficiency in corporate China. Copyright © 2008 John Wiley & Sons, Ltd. | - |
dc.language | eng | en_US |
dc.publisher | Wiley. The Journal's web site is located at http://onlinelibrary.wiley.com.eproxy1.lib.hku.hk/journal/10.1002/(ISSN)1099-1468 | - |
dc.relation.ispartof | Managerial and Decision Economics | en_US |
dc.rights | This is the accepted version of the following article: [Managerial and Decision Economics, 2009, v. 30 n. 3, p. 193-209], which has been published in final form at [http://dx.doi.org/10.1002/mde.1447]. In addition, authors may also transmit, print and share copies with colleagues, provided that there is no systematic distribution of the submitted version, e.g. posting on a listserve, network or automated delivery. | - |
dc.title | Corporate governance and firm efficiency: Evidence from China's publicly listed firms | en_US |
dc.type | Article | en_US |
dc.description.nature | postprint | - |
dc.identifier.doi | 10.1002/mde.1447 | en_US |
dc.identifier.scopus | eid_2-s2.0-66649116021 | en_US |
dc.identifier.volume | 30 | en_US |
dc.identifier.issue | 3 | en_US |
dc.identifier.spage | 193 | en_US |
dc.identifier.epage | 209 | en_US |
dc.identifier.isi | WOS:000213328400006 | - |
dc.identifier.issnl | 0143-6570 | - |