Crossing the River by Touching Stones?: The Reform of Corporate Ownership in China

Wenwen Zhan () and John Turner ()

Asia-Pacific Financial Markets, 2012, vol. 19, issue 3, 233-258

Abstract: The privatization of Chinese enterprises in a low-legal-protection environment raises the question as to how minority shareholders are assured that their capital will not be expropriated. This paper sheds some light on this issue by examining the influence of controlling shareholders on the corporate performance of listed firms from 1997 to 2006. The first main finding is that firms controlled by local governments are more valuable to minority shareholders, whereas firms controlled by individuals are less valuable. The second main finding is that the post-WTO-accession relinquishment of control from local governments to private shareholders appears to have reduced corporate performance. Copyright Springer Science+Business Media, LLC. 2012

Keywords: Protection of minority shareholders; Partial privatization; China; Insider expropriation; G32; G34; L33; P31 (search for similar items in EconPapers)
Date: 2012
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DOI: 10.1007/s10690-011-9148-2

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