Inside China’s state-owned enterprises: Managed competition through a multi-level structure

Abstract

China's state-owned enterprises are among the largest firms in the world, dominating key sectors of the Chinese economy and playing a major role in Chinese projects abroad through the Belt and Road Initiative. This article describes a system of “managed competition” among China's state-owned enterprises that attempts to harness the forces of competition while intervening to ensure a robust field of capable competitors. This system is implemented through a multi-level structure where parent state-owned enterprises coordinate and balance competition among a set of similarly resourced subsidiaries through the allocation of management personnel and resources. This article examines how this approach works in practice through an in-depth empirical case study of two of China's largest infrastructure construction firms: China Railway Group Limited and China Railway Construction Corporation. Understanding the internal structure and operations of China's state-owned enterprises sheds light on a crucial part of China's political economy and on China's efforts to extend its influence globally.

Is state-owned enterprise merging private enterprise “market choice” or “space crowding” ? —Based on the motives of equity transfer of mixed-ownership enterprises

“…According to China's capital market statistics, from 2018 to 2021, the number of state-owned enterprises acquiring privately listed companies was 21, 40, 49, and 41, accounting for 20.19%, 24.24%, 21.03% and 18.47% of the change in control of listed companies during the same period [ 2 ]. This has caused strong reactions in society and triggered private entrepreneurs to worry about “the state advancing and the people retreating” and the “squeezed living space” [ 3 ].…”