Financing patterns in transition economies: Privatized former SOEs versus ab initio private firms

Yu Liu, Nilesh Sah, Barkat Ullah and Zuobao Wei

Emerging Markets Review, 2020, vol. 43, issue C

Abstract: We employ 37,987 firms in 30 transition economies to investigate the relation between the origins of private firms and their financing patterns. We find that relative to ab initio (from the beginning) private firms, privatized former state-owned enterprises (SOEs) finance a higher proportion of their fixed assets from bank finance (especially from state-owned banks) and supplier credit. We argue that privatized former SOEs continue to benefit from the political and financial connections established during their SOE era. We document that country governance, financial development and legal origins play an important role in the financing patterns of privatized versus private firms.

Keywords: Privatization; Financing pattern; Transition economy; Institutional development; Business Environment and Enterprise Performance Survey (BEEPS) (search for similar items in EconPapers)
JEL-codes: G10 G32 L33 O16 (search for similar items in EconPapers)
Date: 2020
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (8)

Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/S1566014119301724
Full text for ScienceDirect subscribers only

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:eee:ememar:v:43:y:2020:i:c:s1566014119301724

DOI: 10.1016/j.ememar.2020.100680

Access Statistics for this article

Emerging Markets Review is currently edited by Jonathan A. Batten

More articles in Emerging Markets Review from Elsevier
Bibliographic data for series maintained by Catherine Liu ().