Employment Effects of Privatisation and Foreign Acquisition of Chinese State-Owned Enterprises
University of Nottingham Research Paper No. 2006/32
30 Pages Posted: 7 Nov 2006
Date Written: November 2006
This paper investigates the effects of domestic privatisation or foreign acquisition of Chinese State Owned Enterprises (SOEs) on employment growth, using firm level data for China and a combination of propensity score matching and difference-in-differences in order to identify the causal effect. Our results suggest that, controlling for output growth there is some evidence that domestic privatisation leads to contemporaneous reductions in employment growth compared to firms that did not undergo an ownership change. By contrast, there is some evidence that foreign acquisitions show higher employment growth in the post acquisition period than non-acquired SOEs.
Keywords: Privatisation, Employment growth, State-owned enterprises, China
JEL Classification: F23, L33
Suggested Citation: Suggested Citation