Paradox of Efficiency in Chinese State-Owned Enterprises: Empirical Analysis and Theoretical Explanation

Author: Compiler: Li Liying
Publisher:
Publish Date: 2006-09-01
Features: The issue of state-owned enterprise reform has long been studied in academia primarily through qualitative descriptions and theoretical arguments, with less emphasis on empirical data-driven research. This book is a welcome exception. Since the reform, the fact that the productivity of China's state-owned enterprises has increased while their profitability has generally declined has created the "efficiency paradox" problem, which this book specifically addresses. Using empirical analysis methods, the book systematically examines the impact of major reform measures implemented in different stages after the reform on the efficiency and profit rates of state-owned enterprises. Since the reform, while the productivity of China's state-owned enterprises has increased, their profitability has generally declined, which is precisely the "efficiency paradox" problem this book focuses on. Through empirical analysis, the book systematically examines the impact of major reform measures implemented in different stages after the reform on the efficiency and profit rates of state-owned enterprises and finds that: early decentralization and profit-sharing reforms for state-owned enterprises, as well as the establishment of modern enterprise systems in the mid-1990s and later, effectively promoted the increase in productivity of state-owned enterprises but did not achieve consistent results in boosting profit rates. The book aims to explain this outcome by incorporating the impact of major reform measures on productivity and profitability into a unified theoretical framework, arguing that the fundamental reason for the efficiency paradox lies in the changes in the internal interest distribution structure of state-owned enterprises, which occurred under the intensification of market competition and the reform process.