State-owned enterprise reform in Latin America

Includes bibliography

The innovation process of a privately-owned enterprise and a state-owned enterprise in China

This study compares the innovation process of a privately-owned enterprise and a state-owned enterprise in China using their patent data. Huawei and ZTE were selected for this study because they experienced the same historical environment in the same industry from the same region in China leaving their owner types as their critical difference. This study investigates the difference in the innovation process in R&D between a privately-owned and a state-owned enterprise by analyzing (1) domestic and international patent application pattern, (2) co-application and co-applicants, (3) knowledge accumulation inside Huawei and ZTE, and (4) knowledge spillover to domestic and foreign firms.

The First Privatization Policy in a Democracy: Selling State-Owned Enterprises in 1948-1950, Puerto Rico

In the 1940s, when the Governor of Puerto Rico was appointed by the US President and the Puerto Rican government was answerable only to the US Federal government, a large state-owned enterprise (SOE) sector was established on the island. Public services such as water, transportation and energy were nationalized, and several new manufacturing SOEs were created to produce cement, glass, shoes, paper and chalkboard, and clay products. These enterprises were created and managed by government-owned corporations. Later on, between 1948 and 1950, under the island’s first elected Governor, the government sold these SOEs to private groups. This paper documents both the creation and the privatization of the SOE sector in Puerto Rico, and analyzes the role played by ideology, political interests, and economic concerns in the decision to privatize them. Whereas ideological factors might have played a significant role in the building of the SOE sector, we find that privatization was driven basically by economic factors, such as the superior efficiency of private firms in the sectors where the SOEs operated, and by the desire to attract private industrial investment to the Puerto Rican economy.

Vietnamese Local State-owned Enterprises (SOEs) at the Crossroads: Implications of SOE Restructuring at the Local Level

This paper aims to capture the changing features of local SOEs under the national SOE restructuring program in the 2000s. The national policy on SOE reform in this phase had an effect of considerably clarifying and narrowing down the raison d'être of SOEs, which has been put into practice at the local level through provincial master plans. Consequently, some signs of an important change are observed: the structure of the local SOE sector is being standardized to a certain extent, and the remaining local SOEs are becoming more geared to the needs of a market economy. This trend would have far-reaching implications for the policy implementation and public service delivery by localities, which in turn would affect the long-term development of non-state sectors.

State-owned enterprises, exporting and productivity in China:a stochastic dominance approach

A popular explanation for China's rapid economic growth in recent years has been the dramatic increase in the number of private domestic and foreign-owned firms and a decline in the state-owned sector. However, recent evidence suggest that China's state-owned enterprise (SOEs) are in fact stronger than ever. In this paper we examine over 78,000 manufacturing firms between 2002 and 2006 to investigate the relationship between ownership structure and the degree of firm-level exposure to export markets and firm-level productivity. Using a conditional stochastic dominance approach we reveal that although our results largely adhere to prior expectations, the performance of state-owned enterprises differs markedly between those that export and those that supply the domestic market only. It appears that China's internationally focused SOEs have become formidable global competitors.

The Effects of Privatization of State-Owned Enterprises in Poland and East Germany

The main goal of this project was to propose appropriate methods of analysing the effects of the privatisation of state-owned enterprises, methods which were then tested on a limited sample of 16 Polish and 8 German enterprises privatised in 1992. A considerable amount of information was collected relating to the six-year period 1989-1994 relating to most aspects of the companies' activities. The effects of privatisation were taken to be those changes within the enterprises which were the result of privatisation, in such areas as production, the productivity of labour and fixed assets, investments and innovations, employment and wages, economic incentives (especially for top managers), financing (internal and external sources), bad debts and economic effects (financial analysis). A second important goal was to identify the main factors which represent methodological obstacles in surveys of the effects of privatisation during a period of fundamental transformation of the entire economic system. The list of enterprises for the research was compiled in such a way as to allow for the differentiation of ownership structures of privatised firms and to permit (at least to a certain extent) the empirical verification of some hypotheses regarding the privatisation process. The enterprises selected were divided into the following three groups representing (as far as possible) various types of ownership structures or types of control: (1) enterprises control by strategic investors (domestic or foreign), (2) enterprises controlled by employees (employee-owned companies), (3) enterprises controlled by managers. Formal methods such as econometric models with varying parameters were used to separate pure privatisation effects from other factors which influence various aspects of an enterprise's working, including policies on the productivity of labour and capital, average wages, the remuneration of top managers, etc. While the group admits that their findings and conclusions cannot be treated as representative of all privatised enterprises in Poland and Germany, they found considerable convergence with their findings and those of other surveys conducted on a wider scale. The main hypotheses that were confirmed included that privatisation (especially in companies controlled by large investors and managers) leads to a significant increase in the effectiveness of these production process, growing pay differentials between different employee groups (e.g. between executives and rank-and-file employees) and between different jobs and positions within particular professional groups. They also confirmed the growing importance in incentives to top executives of incentives linked with the company's economic effects (particularly profit-related incentives), long-term incentives and the capital market.

Through the lenses of organizational culture: A comparison of state-owned enterprises and joint ventures in China

This study compared state-owned enterprises (SOEs) and joint ventures (JVs) in light of organizational culture practices. Data were obtained via a survey participated by 781 respondents from five enterprises. Factoring identified four cultural dimensions: Participation, Teamwork, Supervision, and Meetings. All four dimensions, except Participation, were rated significantly higher by respondents from SOEs as compared to the ratings in JVs. Based on the findings, this study concluded that culture practices valued in one type of enterprise might be liability in another. The implication for management is to gear culture practices to the characteristics of the organization to make it successful.

The impact of the post-1993 economic reforms on Chinese state-owned enterprises:evidence from the electronics industry

Since 1979, China has embarked on a series of economic reform programmes, leading its socialist economy away from a Soviet planning model towards a much greater reliance on the market. In the course of the last twenty years, the Chinese economy has enjoyed a phenomenally high economic growth rate. However, earlier research suggests that Chinese state-owned enterprises remain a financial 'black hole' for the Chinese economy, in spite of various enterprise reform measures. This thesis tries to assess the impact of the reforms after 1993, especially the so-called Modern Enterprise System, on the behaviour and management practices of state firms. The central research question is whether the new rounds of economic reform have changed state firms into commercial entities operating according to market signals, as intended. In order to explore this question, an institutional approach is employed. More specifically, the thesis examines how the behaviour and management practices of state enterprises have changed with changes in the institutional environmental resulting from the introduction of new reform measures and especially the MES. The main evidence used in this research comes from the Chinese electronics industry (CEI). Non-state firms, namely collectives and joint ventures, are involved in the study to provide a benchmark against which changes in the behaviour of state firms in the mid and late 1990s are compared. A comparative statistical analysis shows that state-owned firms, both traditional and corporatised ones, still lag behind collectives and joint ventures in terms of both labour and total factor productivity. The further empirical work of this research consists of a questionnaire survey and case studies that are based on interviews with senior managers of 17 firms in the CEI. The findings of these analyses suggest that there has been little fundamental change in the behaviour pattern of state firms in the 1990s, despite the introduction of the Modern Enterprise System, and that the economic reforms after 1993 so far seem to have failed to transform the state firms into commercial entities operating according to market signals.

Capabilities and competitiveness of Chinese state owned manufacturing enterprises:what has been learned over 20 years and what remains to be learned

Technological capabilities in Chinese manufacturing have been transformed in the last three decades. However, the extent to which and how domestic market oriented state owned enterprises (SOEs) have developed their capabilities remain important questions. The East Asian latecomer model has been adapted to study six Chinese SOEs in the automotive, steel and machine tools sectors to assess capability levels attained and the role of external sources and internal efforts in developing them. All six enterprises demonstrate high competence in operating established technology, managing investment and making product and process improvements but differ in innovative capability. While the East Asian latecomer model in which linking, leveraging and learning explain technological capability development is relevant for the companies studied, it needs to be adapted for Chinese SOEs to take account of types of external links and leverage of enterprises, the role of government, enterprise level management motives and means of financing development.

INTERNATIONALIZATION OF STATE-OWNED ENTERPRISES THROUGH FOREIGN DIRECT INVESTMENT

ABSTRACT State-owned enterprises (SOEs) are created to focus on domestic needs, and yet recent evidence points to increasing outward foreign direct investment by SOEs. Existing International Business (IB) theories focus on efficiency-based motives for internationalization; therefore, they do not fully capture SOEs' internalization dynamics, which are driven largely by political factors and social welfare considerations. We integrate public management and IB theories to develop propositions that combine these questions: why SOEs internationalize; what are their motivations; and what are the main managerial outcomes of SOEs' internationalization. Our findings suggest that SOEs display little hesitancy in entering international markets, and that SOE international expansion is not contradictory with the goals of state-ownership if the purpose is to adjust the company to changing institutional environments both in the domestic and international markets. Our propositions about SOE internationalization are based on an in-depth case study of the outward foreign direct investment conducted by Brazil's Petrobras over the past three decades.

Reconceptualizing Chinese state-owned entreprise in Africa : double embeddedness and localization in Ghana

Challenging the view of asymmetrical power relations between China and Africa, this thesis questions the "Chinese comparative advantages" (monolithic state power and economic advantages) of Chinese state-owned enterprises (SOEs) in Africa. It argues that the power dynamics between Chinese and African actors are dialectical and pluralistic, with localized social capital representing the true Chinese competitive advantage in Africa. Based on ethnographical fieldwork conducted in Ghana, this thesis shows that Chinese SOEs pursue their globalization in a double context - that of the deliberate "retreat" of the Chinese state, and more importantly, that of Ghanaian governance and society (characterized by political party patronage, extraversion dynamics, and worker agency). The trajectories of Chinese expatriates' expatriation/ social promotion and their SOEs' globalization/ localization are mutually influenced and reinforced. By cultivating local relationships and knowledge, a provincial Chinese SOE in Ghana can outperform a large Chinese central SOE, even if the latter has more support from the Chinese state. Moreover, the recent effort to build a "socially acceptable Chinese community" in Ghana has renewed the power dynamics between the Chinese state and the SOEs. All these observations provide for constructing a new perspective of Chinese SOEs in Africa - a "second-class" Chinese globalization - the SOEs may begin with few privileges, but promotion over time is possible. -- A contre pied des approches postulant des relations de pouvoir asymétriques entre la Chine et l'Afrique, cette thèse interroge les « avantages comparatifs chinois » (pouvoir de l'État monolithique et avantages économiques) des entreprises publiques chinoises (EPC) en Afrique. Elle soutient l'idée selon laquelle les dynamiques de pouvoir entre les acteurs chinois et africains est dialectique et pluraliste, et le capital social localisé étant le véritable avantage compétitif chinois en Afrique. S'appuyant sur un travail de terrain ethnographique au Ghana, cette thèse montre que les EPC poursuivent leur mondialisation dans un double contexte - celui de la «retraite» délibérée de l'État chinois, et, de façon plus importante, celui de la gouvernance et de la société ghanéennes (caractérisées par un clientélisme des partis politiques, une dynamique d'extraversion et le pouvoir de négociation des travailleurs). Les trajectoires d'expatriation / de promotion sociale des expatriés chinois et la mondialisation / localisation de leurs EPC s'influencent et se renforcent mutuellement. En cultivant des relations et des connaissances locales, une EPC provinciale au Ghana peut surpasser une grande EPC centrale, même si cette dernière reçoit plus de soutien de l'État chinois. En outre, les efforts récents visant à construire une «communauté chinoise socialement acceptable» au Ghana ont renouvelé la dynamique du pouvoir entre l'État chinois et les EPC. Ces observations permettent de construire une nouvelle perspective des EPC en Afrique - la globalisation chinoise de « deuxième classe » - les EPC peuvent débuter avec peu de privilèges, mais leur promotion reste possible avec le temps.

The developmental state in Brazil: comparative and historical perspectives

The record of successful developmental states in East Asia and the partial successes of developmental states in Latin America suggest several common preconditions for effective state intervention including a Weberian bureaucracy, monitoring of implementation, reciprocity (subsidies in exchange for performance), and collaborative relations between government and business. Although Brazil failed to develop the high technology manufacturing industry and exports that have fueled sustained growth in East Asia, its developmental state had a number of important, and often neglected, successes, especially in steel, automobiles, mining, ethanol, and aircraft manufacturing. Where Brazil's developmental state was less successful was in promoting sectors like information technology and nuclear energy, as well as overall social and regional equality. In addition, some isolated initiatives by state governments were also effective in promoting particular local segments of industry and agriculture. Comparisons with East Asia, highlight the central role of state enterprises in Brazil that in effect internalized monitoring and reciprocity and bypassed collaboration between business and government (that was overall rarer in Brazil).