The impact of privatization on firm performance in a transition economy : the case of Vietnam/ created by Truong Dong Loc, Ger Lanjouw and Robert Lensink

By:

Loc, Truong Dong [author]

Contributor(s):

Material type: Text

TextSeries: Economic of transition ; Volume 14, number 2Oxford: Blackwell Publishing, 2006Content type:

text

Media type:

unmediated

Carrier type:

volume

ISSN:

09670750

Subject(s):

Privatization -- Ownership structure -- Firm performance -- Vietnam

Online resources:

Click here to access online

Abstract: The Vietnamese privatization programme, launched in 1992, differs from the usual Western privatization programmes in terms of the residual percentage of shares owned by the state and the portion of shares owned by insiders. This begs the question whether these differences influence the effects of the programme on firm performance. This study measures the impact of privatization on firm performance in Vietnam by comparing the pre- and post-privatization financial and operating performance of 121 former state-owned enterprises (SOEs). We find significant increases in profitability, sales revenues, efficiency and employee income. Results of applying the 'difference-in-difference' (DID) method, wherein a control group of firms is used to pick up the influence of other determinants of firm performance, suggest that the performance improvements may indeed be associated with equitization. Regression analyses reveal that firm size, residual state ownership, corporate governance and stock market listing are key determinants of performance improvements.

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Holdings
Item type	Current library	Call number	Vol info	Copy number	Status	Notes	Date due	Barcode
Journal Article	Main Library - Special Collections	HC244 ECO (Browse shelf(Opens below))	Vol. 14, no.2 (pages 349-390)	SP667	Not for loan	For in house use only

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The Vietnamese privatization programme, launched in 1992, differs from the usual Western privatization programmes in terms of the residual percentage of shares owned by the state and the portion of shares owned by insiders. This begs the question whether these differences influence the effects of the programme on firm performance. This study measures the impact of privatization on firm performance in Vietnam by comparing the pre- and post-privatization financial and operating performance of 121 former state-owned enterprises (SOEs). We find significant increases in profitability, sales revenues, efficiency and employee income. Results of applying the 'difference-in-difference' (DID) method, wherein a control group of firms is used to pick up the influence of other determinants of firm performance, suggest that the performance improvements may indeed be associated with equitization. Regression analyses reveal that firm size, residual state ownership, corporate governance and stock market listing are key determinants of performance improvements.

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