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Effects of Privatization on Exporting Decisions: Firm-level evidence from Chinese state-owned enterprises

Author

Listed:
  • TODO Yasuyuki
  • INUI Tomohiko
  • YUAN Yuan
Abstract
This paper examines whether or not privatization of Chinese state-owned enterprises (SOEs) increases the probability of exporting, and, if so, what channels generate such effect. Using firm-level data for the Chinese manufacturing sector for the period 2000-2007, we find that privatization has a positive effect on exporting decisions, productivity, and firm size and a negative effect on firms' long-term debt. We also find that Chinese firms are more likely to engage in export when the productivity level, firm size, or long-term debt is larger. These two sets of results suggest that privatization has positive effects on exporting decisions through improving productivity and firm size and a negative effect through lowering debt. However, quantitative analysis reveals that effects of privatization through these three channels are small. Therefore, we conclude that the positive effect of privatization on exporting decisions comes mostly from other unobservable factors, most probably changes in attitude toward profits and risks associated with privatization.

Suggested Citation

  • TODO Yasuyuki & INUI Tomohiko & YUAN Yuan, 2012. "Effects of Privatization on Exporting Decisions: Firm-level evidence from Chinese state-owned enterprises," Discussion papers 12015, Research Institute of Economy, Trade and Industry (RIETI).
    • Handle: RePEc:eti:dpaper:12015
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    Cited by:

    1. Wei Wei & Jianmin Tang, 2019. "Ownership transformation, firm performance and manufacturing growth in China," Economics of Transition and Institutional Change, John Wiley & Sons, vol. 27(2), pages 475-496, February.
    2. Yasuyuki Todo, 2016. "The effects of privatization on exports and jobs," IZA World of Labor, Institute of Labor Economics (IZA), pages 309-309, November.
    3. Ryuhei Wakasugi & Hongyong Zhang, 2016. "Impacts of the WTO accession on Chinese exports," Journal of Chinese Economic and Business Studies, Taylor & Francis Journals, vol. 14(4), pages 347-364, October.

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