ASSOCIATION BETWEEN STATE OWNERSHIP PARTICIPATION AND RENT-SEEKING BEHAVIOR OF PRIVATE FIRMS IN CHINA

Liuzhen Zhang (), Feng Niu () and Wunhong Su
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Liuzhen Zhang: School of Accounting, Hangzhou Dianzi University, Hangzhou, Zhejiang, P. R. China
Feng Niu: School of Accounting, Hangzhou Dianzi University, Hangzhou, Zhejiang, P. R. China
Wunhong Su: School of Accounting, Hangzhou Dianzi University, Hangzhou, Zhejiang, P. R. China

The Singapore Economic Review (SER), 2024, vol. 69, issue 01, 81-117

Abstract: The rent-seeking behavior of firms in economic society destroys the fair market order and hinders the sustainable development of the economy. In the context of the mixed-ownership reform, this study examines whether and how state ownership participation affects the rent-seeking behavior of private firms using Chinese-listed private firms from 2010 to 2019. The findings suggest that state ownership participation significantly eliminates the rent-seeking behavior of private firms. However, the eliminating effect of state ownership participation on private firms’ rent-seeking behavior is weakened by high economic policy uncertainty and government intervention where private firms operate. The findings of this study enrich the characteristics and influencing factors of rent-seeking behavior of private firms, expand the literature on Chinese mixed-ownership participation, provide empirical evidence that is inconsistent with Western theoretical predictions, construct a new theory based on practices with Chinese characteristics and further reveal the characteristics of Chinese accounting practices.

Keywords: State ownership participation; private firms; rent-seeking behavior; China (search for similar items in EconPapers)
Date: 2024
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DOI: 10.1142/S0217590823500091

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