State-owned versus township and village enterprises in China

Perotti, E.C., Sun, L., & Zhou, L. (1999). State-owned versus township and village enterprises in China. Comparative Economic Studies 41 (2) 151-179. 10.1057/ces.1999.11.

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This paper presents an up-to-date survey of the comparison issue between state-owned enterprises (SOEs) and township-village enterprises (TVEs) in China. Although TVEs are at a disadvantage in areas such as technology, labor skills, education levels of staff, access to bank loans and government supports, they have important advantages in ownership and governance structures, personnel systems and labor relations, and conditions of institutional arrangement. These advantages apparently have outweighed the disadvantages, allowing the TVEs to outperform SOEs and successfully expand their market shares that previously belonged to the SOEs. However, our analysis also reveals that SOEs may not have performed so badly if their broad social contributions other than reported profits are also taken into account. In conclusion, we argue that both SOEs and TVEs need to reform their ownership and governance structures. In particular, if TVEs are to develop further during the next century, they cannot avoid the grassroots democratization.

Part of this paper was written and revised while Laixiang Sun was visiting the World Institute for Development Economics Research (UNU/WIDER) in Helsinki and Liang Zou was visiting the Hong Kong Baptist University. They gratefully acknowledge the gracious support of their hosts. While fully responsible for any remaining errors, all the authors wish to thank Robert C. Stuart, the editor, and an anonymous referee of this journal for their comments and advice.

Item Type: Article
Research Programs: Modeling Land-Use and Land-Cover Changes (LUC)
Bibliographic Reference: Comparative Economic Studies; 41(2-3):151-179 [1999]
Depositing User: IIASA Import
Date Deposited: 15 Jan 2016 02:10
Last Modified: 27 Aug 2021 17:16

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