TY - JOUR
T1 - Business group affiliation and firm performance in a transition economy
T2 - A focus on ownership voids
AU - Ma, Xufei
AU - Yao, Xiaotao
AU - Xi, Youmin
N1 - Funding Information:
We thank Editors Mike Peng and Andrew Delios, the anonymous APJM reviewer, and the participants of APJM Special Issue Conference on Conglomerates and Business Groups in Asia-Pacific for helpful comments and suggestions on earlier versions of this paper. This research is supported by three grants from the National Natural Science Foundation of China (No. 70472035, No. 70202003, and No. 7012001).
PY - 2006/12
Y1 - 2006/12
N2 - In a transition economy, how does business group affiliation make a difference in firm performance? Under the broad label of institutional voids, what specific voids can business groups fill? This paper addresses these questions by drawing on insights from property rights theory and an institutional perspective. We argue that ownership voids, as a subset of institutional voids, occur due to the lack of unambiguously specified ownership of state assets in transition economies, and that business groups emerge to serve as the direct owners of state-owned enterprises to replace such voids. Based on a sample of 1,119 publicly-listed Chinese companies, we find that the interaction of business group affiliation and state ownership has a significant and positive effect on firm performance. Our findings point to business group's substitution role in filling ownership voids in China's transition economy.
AB - In a transition economy, how does business group affiliation make a difference in firm performance? Under the broad label of institutional voids, what specific voids can business groups fill? This paper addresses these questions by drawing on insights from property rights theory and an institutional perspective. We argue that ownership voids, as a subset of institutional voids, occur due to the lack of unambiguously specified ownership of state assets in transition economies, and that business groups emerge to serve as the direct owners of state-owned enterprises to replace such voids. Based on a sample of 1,119 publicly-listed Chinese companies, we find that the interaction of business group affiliation and state ownership has a significant and positive effect on firm performance. Our findings point to business group's substitution role in filling ownership voids in China's transition economy.
KW - Business group
KW - Institutional perspective
KW - Performance
KW - Property rights theory
KW - Transition economy
UR - http://www.scopus.com/inward/record.url?scp=33845981441&partnerID=8YFLogxK
U2 - 10.1007/s10490-006-9011-6
DO - 10.1007/s10490-006-9011-6
M3 - Review article
AN - SCOPUS:33845981441
SN - 0217-4561
VL - 23
SP - 467
EP - 483
JO - Asia Pacific Journal of Management
JF - Asia Pacific Journal of Management
IS - 4
ER -