The Impact of Government Assistance to State-owned Enterprises on Foreign Start-ups: Evidence from Yangtze River Delta

Omar Abu Risha (), Qingshi Wang, Shanshan Dou (), Mohammed Ismail Alhussam () and Junguo Shi ()
Additional contact information
Omar Abu Risha: Dongbei University of Finance and Economics
Qingshi Wang: Dongbei University of Finance and Economics
Shanshan Dou: Jiangsu University
Mohammed Ismail Alhussam: Harbin Institute of Technology (Shenzhen)
Junguo Shi: Jiangsu University

East Asian Economic Review, 2022, vol. 26, issue 3, 205-225

Abstract: Different types of corporate ownership may affect the environment among firms and could influence the decisions of new entities in the region. This study determines the role of state-owned enterprises (SOEs) in hindering new foreign manufacturing firms in the Yangtze River delta (YRD). The negative binomial regression is used for city-sector level data and the following points summarize the results: Firstly, the unique privileges that SOEs enjoy alongside governmental support create difficulties for foreign firms trying to establish themselves near existing SOEs. Secondly, although core cities are more attractive to foreign firms than peripheral cities, the role of core-periphery reveals that, in spite of all the regional advantages core cities could offer, whenever the share of SOEs is higher, the core-periphery system will have an adverse impact on new foreign firms. In other words, government preference for SOEs can suppress the attraction of foreign startups. However, after 2008, the governmental authorities finally succeeded in implementing their promising policy of fair treatment and competition in only the core cities.

Keywords: New Foreign Firms; State-owned Enterprises; Core–periphery; Yangtze River Delta (search for similar items in EconPapers)
JEL-codes: F23 H79 L60 (search for similar items in EconPapers)
Date: 2022
References: Add references at CitEc
Citations: View citations in EconPapers (1)

Downloads: (external link)
https://dx.doi.org/10.11644/KIEP.EAER.2022.26.3.411 Full text (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:ris:eaerev:0411

Access Statistics for this article

East Asian Economic Review is currently edited by JE Lee

More articles in East Asian Economic Review from Korea Institute for International Economic Policy [30147] 3rd Floor Building C Sejong National Research Complex 370 Sicheong-daero Sejong-si, Korea. Contact information at EDIRC.
Bibliographic data for series maintained by JE Lee ().