Manuscript type: ReviewResearch Question/ Issue: Which forms of state control over corporations have emerged in countries that made a transition from centrally-planned to marked-based economies and what are their implications for corporate governance? We assess the literature on variation and evolution of state control in transition economies focusing on corporate governance of statecontrolled firms. We highlight emerging trends and identify future research avenues.Research Findings/ Insights: Based on our analysis of more than a hundred articles in leading management, finance and economics journals since 1989, we demonstrate how research on state control evolved from a polarized approach of public -private equity ownership comparison to studying a variety of constellations of state capitalism.
Theoretical/ Academic Implications:We identify theoretical perspectives that help us better understand benefits and costs associated with various forms of state control over firms. We encourage future studies to examine how context-specific factors determine the effect of state control on corporate governance.
Practitioner/ Policy Implications:Investors and policy-makers should consider under which conditions investing in state-affiliated firms generates superior returns.
INTRODUCTIONOver a quarter of a century since the fall of the Berlin Wall, former communist regimes have transitioned to democratic or semi-democratic regimes, although the process of becoming market economies has advanced at different rates and directions across countries. Transition economies represent a large sub-category of emerging economies (Hoskisson, Eden, Lau, & Wright, 2000;Hoskisson, Wright, Filatotchev, & Peng, 2013). Given the 25 years since 1989, it is timely to review how means of state control have changed in these transition economies.While developed economies have seen a gradual demise of state-owned enterprises (SOEs) and there has been extensive privatization in emerging economies, state capitalism is a popular choice among transition economies (Wooldridge, 2012). Accordingly, we address the following research question: "Which forms of state control over corporations have emerged in countries that made a transition from centrally-planned to marked-based economies and what are their implications for corporate governance?" To address this question, we suggest a taxonomy of state control used to structure our literature review.We consider the transformation of state control in transition economies focusing on the emergence of contemporary forms of state capitalism following privatizations of the 1990s. Earlier reviews focused on privatization comparing performance of state-owned and privatized companies (Estrin & Wright, 1999;Megginson & Netter, 2001; Djankov & Murrell, 2002), but interactions between state and private sector have evolved and new forms of state control have emerged. Our motivation is driven by a lack of comprehensive reviews encompassing the evolution and variety of state control over firms and their governan...
