Marketization level, government intervention and firm M&amp;As: evidence from the local SOEs in China

Yang, Dan; Wang, Guojun; Lu, Mokai

doi:10.1080/13504851.2019.1616059

Cited by 15 publications

(8 citation statements)

References 8 publications

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“…Due to the different reform processes and levels of economic development in different provinces, the level of marketization varies widely across China's provinces. Following the existing literature [55][56][57], the marketization level is measured by the marketization index, which was construed by Wang et al [58], since they measured marketization from five aspects: commodity market, factor market, nonstate (private) sector, market intermediaries, and the relationship between the government and the market. All samples were divided into groups of high or low level of marketization.…”

Section: Heterogeneity Test 441 Heterogeneity Of Marketization Levelmentioning

confidence: 99%

The Impact of Compensation Gap on Corporate Innovation: Evidence from China’s Pharmaceutical Industry

Shan

2022

IJERPH

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The pharmaceutical industry is typically driven by innovation, and is relevant to people’s livelihoods. How to effectively motivate pharmaceutical enterprises to engage in innovative activities is a hot topic. On the basis of the perspective of the combined effect of tournament theory and social comparison theory, this study explored the impact of internal compensation gap on corporate innovation by using data from China’s listed pharmaceutical enterprises during 2011–2018. The findings show a nonlinear (inverted-U-shaped) relationship between compensation gap and corporate innovation within the pharmaceutical industry, which illustrates that the role of the compensation gap is not endless. We also find the optimal compensation gap between executives and employees. Further analyses indicate that this association is more pronounced in regions with low marketization levels, and in large enterprises. Moreover, the practical significance of the results is explored with an expectation of providing theoretical references for the pharmaceutical industry to establish reasonable incentive mechanisms and promote innovative development, and for the government to introduce innovation incentive policies.

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Section: Heterogeneity Test 441 Heterogeneity Of Marketization Levelmentioning

confidence: 99%

The Impact of Compensation Gap on Corporate Innovation: Evidence from China’s Pharmaceutical Industry

Shan

2022

IJERPH

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“…This system is constructed based on objective statistics or survey data [55]. This index can provide rich information on the process of marketization and has been widely used in the existing literature [56][57][58]. The marketization index data from 2008 to 2015 were selected for analysis.…”

Section: Analysis Of the Main Resultsmentioning

confidence: 99%

Rural Financial Development Impacts on Agricultural Technology Innovation: Evidence from China

Liu

Lin

et al. 2021

IJERPH

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Agricultural technology innovation is key for improving productivity, sustainability, and resilience in food production and agriculture to contribute to public health. Using panel data of 31 provinces in China from 2003 to 2015, this study examines the impact of rural financial development on agricultural technology innovation from the perspective of rural financial scale and rural finance efficiency. Furthermore, it examines how the effects of rural financial development vary in regions with different levels of marketization and economic development. The empirical results show that the development of rural finance has a significant and positive effect on the level of agricultural technology innovation. Rural finance efficiency has a significantly positive effect on innovation in regions with a low degree of marketization, while the rural financial scale has a significantly positive effect on technological innovation in regions with a high degree of marketization. Further analysis showed that improving the level of agricultural technology innovation is conducive to rural economic development. This study provides new insights into the effects of rural financial development on sustainable agricultural development from the perspective of agricultural technology innovation.

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“…Model 1-Model 4 in Table 6 show that the results for hypotheses such as Equations (3) and (4) (H1, H2a, and H2b). Model 5-Model 8 in Table 6 show the results for hypotheses such as Equations (5) and (6) (H2a, H2b, and H3). The effect of government internationalization subsidies and government intervention having a positive and significant impact to local SOEs' CBM & A separately, no matter whether government interaction existed, is shown in Table 6.…”

Section: Resultsmentioning

confidence: 99%

“…In addition, the marketization level restrains or even reverses the intervention effect of local government on local SOEs' M&A. However, when the government has stronger control over local SOEs, the marketization level increases the inhibition of local SOEs' M&A, especially on share-diversified M&A [5]. The government is more willing to encourage the M&A activities of SOEs to promote SOEs' investment in certain fixed assets and major national infrastructure projects as well as the control of important strategic resources, including oil, gas, and minerals.…”

Section: H1 Government Internationalization Subsidies Have a Positivmentioning

confidence: 99%

“…According to Wind statistics, in 2017 alone, 126 state-owned listed companies underwent mergers and acquisitions, with transactions worth 853.8 billion yuan. With the constant development of Chinese SOEs, more and more central and local SOEs go abroad to achieve rapid growth through CBM & A [5]. Because of the background of our country's transition economy and the ownership structure of state-owned shares, the local government can easily be involved in the operation of local SOEs with a dual status shared with the owner of local state-owned assets and social managers.…”

Section: Introductionmentioning

confidence: 99%

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The Cross-Border Mergers and Acquisitions of Local State-Owned Enterprises: The Role of Home Country Government Involvement

Bao

2020

Sustainability

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Existing literature tends to treat enterprises as a whole when measuring government intervention. However, in Chinese region-specific institutional development, ultimate control (i.e., local government) tends to control multiple enterprises. This paper considers the enterprises controlled by the same ultimate controller as a portfolio, which is used to measure government intervention by comparing the differences of the enterprises in the portfolio. This paper uses the data of Chinese listed local state-owned enterprises (LSOEs). and we assess whether local state ownership benefits or offsets LSOEs’ cross-border mergers and acquisitions (CBM & A) activities. We propose a new measurement of government intervention to explain the mechanisms through which government influences the cross-border mergers and acquisitions of local SOEs. The experimental results show that government intervention and region-specific marketization institutional development negatively moderate the effect of government internationalization subsidies and government intervention on CBM & A separately. However, government internationalization subsidies, government intervention, and region-specific marketization enhance the CBM & A effect of state ownership separately. This study explores the benefits of government involvement in local SOEs. The value of this paper is to provide a novel perspective, including the intermediary effect of government intervention and the market environment.

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Marketization level, government intervention and firm M&As: evidence from the local SOEs in China

Cited by 15 publications

References 8 publications

The Impact of Compensation Gap on Corporate Innovation: Evidence from China’s Pharmaceutical Industry

The Impact of Compensation Gap on Corporate Innovation: Evidence from China’s Pharmaceutical Industry

Rural Financial Development Impacts on Agricultural Technology Innovation: Evidence from China

The Cross-Border Mergers and Acquisitions of Local State-Owned Enterprises: The Role of Home Country Government Involvement

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