Effects of privatization on exporting decisions: Firm-level evidence from chinese state-owned enterprises

Yasuyuki Todo, Tomohiko Inui, Yuan Yuan

Research output: Contribution to journalArticle

5 Citations (Scopus)

Abstract

This paper examines whether privatizing Chinese state-owned enterprises increases the probability of exporting and, if so, what factors generate such an effect. Using firm-level data for the Chinese manufacturing sector for the 2000-2007 period, we find that privatization positively affects a firm's productivity, size, and decision to export, whereas we find that it negatively affects the level of a firm's long-term debt. We also find that Chinese firms are more likely to export when the productivity level, firm size, or the level of long-term debt increases. Taken together, these two sets of results suggest that privatization positively affects the likelihood that a firm will export by improving productivity and increasing firm size, whereas it negatively affects such a likelihood by lowering the long-term debt level of the firm. However, a quantitative analysis reveals that the effects of privatization that occur through these three channels are only slight. Therefore, we conclude that the positive effect of privatization on the likelihood of exporting is mainly the result of unobservable factors that are most likely related to changes in attitude about the profits and risks associated with privatization.

Original languageEnglish
Pages (from-to)536-555
Number of pages20
JournalComparative Economic Studies
Volume56
Issue number4
DOIs
Publication statusPublished - 2014 Dec 11
Externally publishedYes

Fingerprint

Exporting
Privatization
State-owned enterprises
Long-term debt
Factors
Productivity
Firm size
Firm productivity
Quantitative analysis
Chinese firms
Manufacturing sector
Firm-level data
Profit

Keywords

  • China
  • export
  • financial factors
  • Privatization
  • productivity

ASJC Scopus subject areas

  • Economics and Econometrics

Cite this

Effects of privatization on exporting decisions : Firm-level evidence from chinese state-owned enterprises. / Todo, Yasuyuki; Inui, Tomohiko; Yuan, Yuan.

In: Comparative Economic Studies, Vol. 56, No. 4, 11.12.2014, p. 536-555.

Research output: Contribution to journalArticle

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