Post‐privatization Ownership and Firm Performance: A Large Meta‐analysis of the Transition Literature

Abstract

This paper aims to perform a meta-analysis of the relationship between post-privatization ownership and firm performance using a large database of the transition literature. Baseline estimation of a meta-regression model that employs a total of 2894 estimates drawn from 121 previous studies indicated the superior impact of foreign ownership on firm performance in comparison with state and domestic private entities. However, it did not go as far as to comprehensively verify the series of hypotheses concerning the interrelationship between different ownership types. The estimation of an extended meta-regression model that explicitly controls for the idiosyncrasies of transition economies and privatization policies strongly suggested that differences between countries in terms of location, privatization method, and policy implementation speed are the cause of the opaqueness seen in the empirical results of the previous literature. The definite evidence of the harmfulness of the voucher privatization for ex-post firm performance is one of the most noteworthy empirical findings obtained from the meta-analysis in this paper. JEL classification numbers: D22, G32, G34, L25, P21, P31

The Response of State‐owned Enterprises to Import Competition: Evidence From Chinese Manufacturing Firms

“…Since then, a vast empirical literature has focused on the experience of the past three decades in the former USSR and Warsaw Pact countries. This literature, summarized and analysed recently by Iwasaki and Mizobata (), has found that indeed privatization has been associated with generally improved ‘performance’ in this context, with caveats related to details such as the level of product‐market competition and the specific institutional setting in which the privatization takes place.…”

Ownership Concentration and Firm Performance in European Emerging Economies: A Meta-Analysis

“…In the case of management and/or employee buy-outs (MEBO), insiders easily concentrated their shares. On the other hand, in the case of direct sales, large investors and foreign capitals had strong investment power and were given priority (Iwasaki and Mizobata, 2018). CEE and FSU countries adopted their own specific measures for privatization.…”

“…Hanousek et al (2015) examined corporate efficiency in old and new Europe and concluded that majority ownership does not ensure efficiency.4 The question of how differences in the types of owners and privatization methods employed can affect firm performance in transition economies has been examined byIwasaki and Mizobata (2018) by using a meta-analysis approach similar to the one described herein. 5 A meta-analysis conducted byHeugens et al (2009), on the other hand, included only studies focusing on companies in Asia.6 These emerging markets include 14 counties in South America, Asia, the Middle East, and Africa and the four CEE/FSU countries (i.e., the Czech Republic, Hungary, Poland, and Russia).…”

“…Concerning the privatization methods in CEE and FSU,Iwasaki and Mizobata (2018) illustrated country specificity and its efficiency. In contrast to CEE/FSU countries, China gradually changed its corporate structure, particularly the enactment of corporate law, in 1994, and has maintained state control in key industries and state restrictions over private ownership.…”

Tax incentive policy and firm performance: evidence from Vietnam

“…Empirical studies in developed countries include research works by Megginson, Nash, and Van Randenborgh (1994), Sakr (2014), and Alipour (2013), while in developing and transition economies they include Boubakri, Cosset, and Guedhami (2008). Iwasaki and Mizobata (2018), Bachiller (2017) use a meta-analysis to explore the impact of privatization on firm performance. Pham (2017Pham ( , 2019, Sakr (2014), Alipour (2013), Loc, Lanjouw, and Lensink (2006), and Tran, Nonneman, and Jorissen (2015) compare changes in firm performance of privatized SOEs in Vietnam.…”