Separation of Control and Cash-Flow Rights of State Owned Listed Enterprises: Channels of Expropriation after the Discriminated Share Reform in China

Literature on agency problems arising between controlling and minority owners claim that separation of cash flow and control rights allows controllers to expropriate listed firms, and further that separation emerges when dual class shares or pyramiding corporate structures exist. Dual class share and pyramiding coexisted in listed companies of China until discriminated share reform was implemented in 2005. This paper presents a model of controller to expropriate behavior as well as empirical tests of expropriation via particular accounting items and pyramiding generated expropriation. Results show that expropriation is apparent for state controlled listed companies. While reforms have weakened the power to expropriate, separation remains and still generates expropriation. Size of expropriation is estimated to be 7 to 8 per cent of total asset at mean. If the "one share, one vote" principle were to be realized, asset inflation could be reduced by 13 percent.

Adjustment methods of national input-output tables for harmonized and consistent multi-regional input-output databases

Despite the fact that input–output (IO) tables form a central part of the System of National Accounts, each individual country's national IO table exhibits more or less different features and characteristics, reflecting the country's socioeconomic idiosyncrasies. Consequently, the compilers of a multi-regional input–output table (MRIOT) are advised to thoroughly examine the conceptual as well as methodological differences among countries in the estimation of basic statistics for national IO tables and, if necessary, to carry out pre-adjustment of these tables into a common format prior to the MRIOT compilation. The objective of this study is to provide a practical guide for harmonizing national IO tables to construct a consistent MRIOT, referring to the adjustment practices used by the Institute of Developing Economies, JETRO (IDE-JETRO) in compiling the Asian International Input–Output Table.