scholarly journals State capitalism, economic systems and the performance of state owned firms

2019 ◽  
Vol 69 (s1) ◽  
pp. 175-193
Author(s):  
Saul Estrin ◽  
Zhixiang Liang ◽  
Daniel Shapiro ◽  
Michael Carney
Keyword(s):  
Research Question ◽  
Empirical Support ◽  
Economic Systems ◽  
Firm Level ◽  
Level Data ◽  
Context Specific ◽  
World Bank Enterprise Survey ◽  
Enterprise Survey ◽  
Privately Owned ◽  
Better Than

In this paper, we pursue two related research questions. First, we enquire whether state owned enterprises (SOEs) perform better than privately owned firms in a large variety of emerging markets. To test this, we develop a unique dataset using firm-level data from the World Bank Enterprise Survey (WBES), resulting in a sample of over 50,000 firms from 57 understudied countries including emerging capitalist, former socialist and state capitalist ones. Our results suggest that SOEs do display productivity advantages over private firms in these understudied economies. Our second research question asks whether the performance of state owned firms in these understudied countries is context specific, namely whether performance depends on the institutional system into which a country is classified. We refer to these systems as configurations. In particular, we are interested in whether state owned firms perform better in “state capitalist” countries including China and Vietnam. We find empirical support for the argument that the “state-led” configuration provides better institutional support for the ownership advantages of SOEs than others.

Does external auditing combat corruption? Evidence from private firms

2018 ◽  
Vol 33 (3) ◽  
pp. 267-287 ◽  
Author(s):  
Omar Farooq ◽  
Nermeen F. Shehata
Keyword(s):  
Financial Statements ◽  
Total Sample ◽  
Firm Level ◽  
Content Type ◽  
The World Bank ◽  
Level Data ◽  
World Bank Enterprise Survey ◽  
Enterprise Survey ◽  
The Relationship ◽  
Practical Implications

Purpose This paper aims to document whether firms with audited financial statements pay lower bribes to get contracts than firms without audited financial statements. In other words, this study assesses whether external auditing helps combat corruption. Design/methodology/approach The World Bank Enterprise Survey data covering the period between 2006 and 2014 is used. The total sample comprised more than 50,000 firms in 126 countries. Findings This paper finds that firms with audited financial statements pay significantly lower bribes compared to firms with unaudited financial statements. The results are robust across various estimation procedures, various proxies for bribery and various sub-samples. It is also found that the relationship between audited financial statements and bribery is more pronounced in environments where firms face higher pressure to engage in corrupt practices. Practical implications The results imply that auditing of financial statements can act as a disciplining device to curb bribery in environments that encourage corruption. Originality/value This paper is the first attempt, according to the authors’ knowledge, to examine the relationship between external auditing and corruption using firm-level data that cover 126 countries and is gathered over a 14-year period. Therefore, the results derived from this study are generalizable.

scholarly journals Exporters in Pakistan and Firms Who Do Not Export: What’s the Big Difference?

2014 ◽  
Vol 19 (Special Edition) ◽  
pp. 207-246
Author(s):  
Theresa Chaudhry ◽  
Muhammad Haseeb
Keyword(s):  
Cross Sections ◽  
Capital Intensity ◽  
Export Market ◽  
Stylized Facts ◽  
Firm Level ◽  
Level Data ◽  
Firm Level Data ◽  
World Bank Enterprise Survey ◽  
Enterprise Survey ◽  
New Literature

A variety of stylized facts about exporters have emerged in the new literature on international trade based on firm-level data. These include low levels of export participation among firms; small shares of export sales in firm revenue; larger firms; and higher levels of productivity, skill, and capital intensity among exporters. In this paper, we seek to examine the extent to which these stylized facts fit the experience of firms in Pakistan, using two cross-sections of firm-level data—the Census of Manufacturing Industries (CMI) 2000/01 for Punjab and the World Bank Enterprise Survey dataset (2006/07) for all Pakistan. We find similar levels of export market participation but very large shares of export sales in firm revenue for those who do, compared to the US sample studied by Bernard, Jensen, Redding, and Schott (2007). We also find, as do many other studies, that exporters exhibit significantly higher total factor productivity (TFP) and are larger in terms of employment than nonexporters. Exporters’ TFP was 150 percent higher than non-exporters before we controlled for firm size. Considering the eight largest sectors (which comprise more than 80 percent of the CMI Punjab), with a few exceptions, exporters had higher labor productivity and offered higher compensation to workers, but used more capital per worker and more imported inputs.

Transactional dynamics in European R & D networks: an assessment of Eureka

2015 ◽  
Vol 18 (3) ◽  
pp. 330-354
Author(s):  
Bruno Brandão Fischer ◽  
José Molero
Keyword(s):  
Transaction Costs ◽  
Transaction Cost Economics ◽  
Empirical Support ◽  
Research Area ◽  
Dynamic Interactions ◽  
Firm Level ◽  
Content Type ◽  
Dynamic Framework ◽  
Level Data ◽  
Ex Ante

Purpose – The purpose of this paper is to verify the impacts of the transaction costs rationale on economic agents’ innovative results when they engage in European R & D networks, supplying both firms and policymakers with empirical support for improved decision making toward economic competitiveness and construction of the European research area. Furthermore, unlike many transaction cost economics assessments, the authors evaluate the existence of transaction costs following a dynamic framework of analysis (instead of using solely ex ante governance choice as a driver of inter-firm “friction” management), offering a novel perspective on these phenomena. Design/methodology/approach – Data consist of firm-level information from Eureka’s Final Reports (1995-2006) for Spanish, Italian, French, British and German firms. Empirical assessments were performed through a two-step approach of direct and indirect effects of network management and potential sources of disturbances. Ordinal regressions were applied in order to identify transaction costs’ relevance as drivers of firms’ technological and commercial outcomes, as well as on managerial quality of alliances. Statistical controls include microeconomic and project-specific variables. Findings – Results highlight the role played by transactional aspects as drivers of companies’ outcomes and managerial complexity. Furthermore, the authors find robust evidence that formal ex ante governance structures are incapable of satisfactorily addressing dynamic disturbances that take place within R & D networks. Whereas such findings are directly related to existing transaction costs, the authors find no support for the usual variables attributed to increased complexity in international inter-firm relationships. Research limitations/implications – Self-selection issues are inherently related to the research instrument (i.e. Eureka’s Reports), while further firm-level data could not be obtained since confidentiality issues protected companies’ names and sectors. Also, network-level data are not available, allowing the evaluation of individual perceptions only. Originality/value – While literature addresses the issue of transaction costs in R & D networks via theoretical assumptions and rough proxies, this assessment offers an in-depth evaluation of a set of valuable indicators with direct implications for researchers, managers and policymakers. Main contributions concern the identification of dynamic interactions (and their respective disturbances) as a key feature of the overall performance of R & D networks, stressing the non-linearity of economic processes in these hybrid relationships, an issue that has been poorly tackled by previous empirical investigations.

scholarly journals South African firm-level evidence of the links between finance and efficiency

2012 ◽  
Vol 5 (1) ◽  
pp. 271-286
Author(s):  
Waldo Krugell ◽  
Marianne Matthee
Keyword(s):  
South Africa ◽  
South African ◽  
Access To Finance ◽  
Firm Level ◽  
The World Bank ◽  
Using Data ◽  
World Bank Enterprise Survey ◽  
Enterprise Survey ◽  
Lower Capacity ◽  
Different Sources

Small and medium-sized enterprises are often seen as drivers of economic growth and development by generating employment opportunities. However, for SMEs to be successful they need finance. Access to finance has been found to be a major obstacle to SMEs’ ability to do business in South Africa. This paper takes a closer look at firms, their access to finance and output per worker in South Africa, by using data from the World Bank Enterprise Survey 2007. The results show that firms that are financially constrained are more vulnerable to shocks and competition, and are weaker contributors to employment creation and growth. These firms are typically small and less established. They hold less inventory, have lower capacity utilisation and are unlikely to be exporters or to introduce new products in response to competition. The results from the regression model confirm that access to finance and different sources of finance are drivers of productivity at firm level.

scholarly journals Exports and the economic performance of large state-owned enterprises in Poland: evidence from firm-level data

2020 ◽  
Vol 82 (1) ◽  
pp. 265-282
Author(s):  
Katarzyna Szarzec ◽  
Wanda Nowara ◽  
Iwona Olejnik
Keyword(s):  
Economic Performance ◽  
State Ownership ◽  
Property Management ◽  
Firm Level ◽  
Private Companies ◽  
Dominant Position ◽  
Oligopolistic Market ◽  
Level Data ◽  
Research Questions ◽  
Privately Owned

The aim of this paper is to investigate the relation between exports and economic performance, and the extent of state ownership in the largest non-financial enterprises in Poland in 2011–2015. We address the following research questions: (i) What is the share of export companies in the group of the largest non-financial enterprises in Poland in terms of ownership structure (stateowned and privately-owned companies) and sectors? (ii) Are there differences in the economic performance of exporting companies compared to their non-exporting counterparts? Among the largest exporters, state-owned companies and companies from the manufacturing and mining sectors still dominate. Exporting state-owned enterprises have higher productivity than non-exporters, which could be caused by their dominant position on the domestic oligopolistic market. Exporting private-owned companies performed better in the case of ROA and ROE than exporting SOEs. This could be explained by the fact that private companies have a higher efficiency of property management and are expected to pay dividends by their shareholders. 

scholarly journals Accounting-Based Brand Scandals and the Implications for Firm-Level Advertising Spending

2021 ◽  
Vol 16 (2) ◽  
pp. 230-239
Author(s):  
Stacey Sharpe
Keyword(s):  
Research Question ◽  
Management Strategies ◽  
Empirical Support ◽  
Securities And Exchange Commission ◽  
Reputation Management ◽  
Central Research ◽  
Department Of Justice ◽  
Firm Level ◽  
Firm Response ◽  
Advertising Spending

Abstract This study examines strategic firm-level advertising behavior around accounting-based brand scandal events. This analysis is guided by propositions presented in the brand scandal and marketing-finance literatures regarding firm response to brand scandal events. While, recent findings from the marketing-finance literature show that managers tend to reduce advertising when anticipating the release of negative information, this response is contrary to the established support and recommendation from the extant brand scandal literature. This inconsistency suggests that firms treat product-based brand scandal events different from accounting-based brand scandal events. A sample of firms accused of financial misreporting by the Securities and Exchange Commission (SEC) and US Department of Justice between 1977 and 2010 is used to examine the central research question and hypotheses regarding the relationship between accounting-based brand scandals and firm-level advertising spending. The results of this analysis provide empirical support for the relevance of advertising expenditures to firm’s approach to reputation management strategies in the wake of accounting-based brand scandals.

From the Fringe to the Fore: Labor Unions and Employee Compensation

2020 ◽  
Vol 102 (1) ◽  
pp. 98-112 ◽  
Author(s):  
Matthew Knepper
Keyword(s):  
Labor Unions ◽  
Multinational Enterprise ◽  
Empirical Literature ◽  
Employee Compensation ◽  
Firm Level ◽  
Apparent Contradiction ◽  
Labor Share ◽  
Level Data ◽  
Union Election ◽  
Enterprise Survey

Conventional wisdom suggests that labor unions raise worker wages, while the newer empirical literature finds only negligible earnings effects. I reconcile this apparent contradiction by arguing that collective bargaining targets fringe benefits. Using U.S. firm-level data from the Bureau of Economic Analysis (BEA) Multinational Enterprise Survey and Compustat, I exploit a regression discontinuity in majority rule union elections to compare changes in employee compensation at firms whose establishment barely won a union election against those that barely lost an election. Following unionization, average employee compensation and employer pension contributions increase, which raises the labor share of compensation.

scholarly journals Outward FDI and Domestic Input Distortions: Evidence from Chinese Firms

2019 ◽  
Vol 129 (624) ◽  
pp. 3025-3057 ◽  
Author(s):  
Cheng Chen ◽  
Wei Tian ◽  
Miaojie Yu
Keyword(s):  
Multinational Corporations ◽  
Empirical Support ◽  
Manufacturing Firms ◽  
Private Firms ◽  
Outward Fdi ◽  
Firm Level ◽  
Chinese Firm ◽  
Level Data ◽  
Production Strategies ◽  
Firm Level Data

Abstract We examine how domestic distortions affect firms’ production strategies abroad by documenting two puzzling findings using Chinese firm-level data of manufacturing firms. First, private multinational corporations (MNCs) are less productive than state-owned MNCs, but they are more productive than state-owned enterprises overall. Second, there are disproportionately fewer state-owned MNCs than private MNCs. We build a model to rationalise these findings by showing that discrimination against private firms domestically incentivises them to produce abroad. The model shows that selection reversal is more pronounced in industries with more severe discrimination against private firms, which receives empirical support.

scholarly journals INVESTMENT CLIMATE AND RELATIVE TECHNICAL EFFICIENCY OF FOOD INDUSTRIES IN NIGERIA

2018 ◽  
Vol 6 (1) ◽  
pp. 284-296
Author(s):  
F. A. Ajagbe ◽  
J. O. Ajetomobi ◽  
D. V. Dlamini
Keyword(s):  
Technical Efficiency ◽  
Investment Climate ◽  
Firm Level ◽  
Food Industries ◽  
Starting Point ◽  
Good Starting Point ◽  
Two Phases ◽  
Industrialization Policy ◽  
World Bank Enterprise Survey ◽  
Enterprise Survey

This study examined the influence of investment climate on technical efficiencies of industries in Nigeria. The study was conducted in two phases namely (i) an estimation of the technical efficiency (TE) was carried out and, (ii) differences in TE across firms were statistically related to indicators of investment climate and firm-level characteristics. The analyses made use of 2009 World Bank Enterprise survey data on Nigeria. The results showed that food industry was more labour intensive and less efficient than other industries in Nigeria. The importance of scale, export and firm ownership was evident from the significance of the variables in all the industries. The results point to the fact that firms in Nigeria can improve their productivity by learning from customers and by facing international competition. Investment climate difficulties had less effect on food industries than others.  The sector could be a good starting point in the nation’s industrialization policy drive if available resources can be utilized optimally.

Estimations of business exposure to corruption in Malaysia

2020 ◽  
Vol 27 (4) ◽  
pp. 1273-1287
Author(s):  
Selamah Abdullah Yusof ◽  
Mohd Nahar Mohd Arshad
Keyword(s):  
Design Methodology ◽  
Public Officials ◽  
Firm Level ◽  
Content Type ◽  
Business Operations ◽  
The World Bank ◽  
Level Data ◽  
Firm Level Data ◽  
Binary Logit ◽  
Enterprise Survey

Purpose This study aims to investigate the level of business exposure to corruption in Malaysia. The authors estimate the effect of bribe requests from business establishments by public officials and identify the level of vulnerability of businesses to such requests. Design/methodology/approach This study uses firm-level data from the World Bank Malaysia Enterprise Survey 2014. The analyses are based on binary logit, tobit and generalized ordered logit regressions. Findings The authors find that one-fifth of firms applying for construction permits or had visits or meetings with tax officials were expected to pay bribes. Firms’ encounters with corruption were higher still when applying for import (29%) or operating license (24.7%). About 40% of the firms considered corruption an obstacle to their business operations to the degree of moderate, major and even severe. On average, 11% of firms’ total annual sales were apportioned for informal gifts or “speed money.” The authors also find that larger, younger and women-managed/owned companies were more likely to be targeted for bribe payments. The amount of bribe paid by foreign-owned firms was higher than the local firms. Manufacturing firms had lower incidences of bribe requests, but the amount paid was higher than services-related companies. Firms run or owned by women also, on average, paid a higher amount bribe. Social implications These findings should be taken into consideration in the efforts to eradicate corruption affecting businesses in Malaysia. Originality/value This study is unique in the sense that it is based on firm-level data for a Malaysian case.

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