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This research seeks to understand the drivers of outward foreign direct investments (FDIs) by state-owned emerging economy firms, the characteristics of their overseas FDI projects and investment locations, and the effects of home and host institutions on the market entry strategies, taking into account the legitimacy of state ownership.

The discussion is based on a comprehensive review of conceptual and empirical literature, as well as case studies available from recognized journals in the field.

State-owned emerging economy firms pursue outward FDIs to respond to policy incentives of the home government and to reduce its political influence over the firm. FDI projects are often large and risky and have low business values. They often enter countries where state ownership is perceived as more legitimate while engaging in legitimacy-building activities in these countries. When their home country has a high level of institutional restrictions, they are less likely to use acquisitions or hold high levels of equity control in foreign subsidiaries. To strengthen local legitimacy, they often use greenfield investments or share equity control with local firms in foreign subsidiaries, particularly when the host country is endowed with strategic assets or when it has a high level of institutional restrictions. However, when having high levels of state ownership or strong political connections, they often commit a high level of resources and hold a high level of equity control in foreign subsidiaries.

The literature mostly investigates the FDI of firms that are structurally separate from the institutions. When the institutions are endogenous as presented in this research, their strategic choices are substantially influenced by noncommercial political motives and perception on their political image.

State-owned firms play important roles in Chinese cross-border acquisition (CBA) activities. However, compared with private firms, state-owned firms have a lower likelihood of acquisition completion and take longer to complete a deal. This paper aims to determine why this phenomenon exists and how state-owned firms can overcome the constraints of their identity.

By integrating organizational learning theory with institutional theory, this paper attempts to answer the research questions from a legitimacy perspective. Employing Chinese CBA data from 1982 to 2014, the authors use a logit model and a random effects model to test the hypothesis.

The results show that a state-owned identity easily causes legitimacy concerns among host country regulatory agencies; thus, it may result in longer and more uncertain evaluation behaviors, which lead to a lower likelihood of CBA completion and a longer deal duration. Only experience with failed acquisitions can increase CBA completion probability. Furthermore, in very complex decision-making environments, such as that surrounding deal duration, only specific types of experience (i.e. experience of failed international acquisitions) can trigger learning behavior, whereas general experience (i.e. failed acquisition experience) has little influence. Favorable bilateral relationships may not improve the completion rate and efficiency of state-owned firms, but high-quality host country institutions lead to a higher likelihood of CBA completion among state-owned firms; however, this may be not conducive to decreasing the time needed to complete an acquisition deal.

First, by discussing the completion rate and duration of CBAs conducted by state-owned firms and analyzing the factors that influence them, this paper enriches and develops the theory of organizational overseas mergers and acquisitions (M&As). Second, by adopting a legitimacy perspective and integrating institutional theory, the authors theorize how state-owned status influences firms’ M&A completion rate and time and test the hypotheses empirically; thus, this paper improves and deepens institutional theory. Third, by discussing how different types of experience (i.e. successful experience vs failed acquisition experience) influence the acquisition completion rate and duration and how general experience and specific types of experience affect these two dependent variables differently, this paper explains how state-owned firms can learn effectively from experience, contributing to organizational learning theory.

The purpose of this paper is to explore the impact of the credit expansion in 2009 and 2010 in China on the capital structure of listed real estate companies.

Chinese listed real estate companies are divided into two groups, state-owned and non-state-owned, because their access to credit markets have different priority to state-owned banks that dominate bank lending. The difference-in-differences approach is employed to test the impact of changes in leverage ratios and loan ratios before and after the credit expansion period in state-owned firms and non-state-owned firms.

Using quarterly panel regressions, the authors find that during the credit expansion period, state-owned companies exhibit a relatively greater increase in leverage ratios than non-state-owned firms. State-owned firms have greater increases in book leverage ratios, market leverage ratios and long-term debt ratios by 5.2, 4.9 and 1.1 per cent, respectively. It is also shown that loan ratios have increased more in state-owned firms than non-state-owned firms during the credit expansion period.

The paper explores only the impacts of credit expansion on capital structure of listed real estate firms in China. Further studies can be conducted to investigate the impact of credit supply on corporate investment decisions of real estate firms and on real estate markets.

The findings can help explain the surge in land and housing prices after 2008 in China. Deng et al. (2015) find that state-owned real estate firms paid more for land price than non-state-owned firms, which contributed to upward pressure on housing prices. This paper shows that such “over-investment” may be due to the increase of debt financing and availability of bank loans to real estate firms. Thus the credit market can affect real estate markets through debt financing at company level.

This paper is the first to investigate the impact of credit supply on capital structure of real estate companies, and presents evidence of the importance of credit supply as a determinant of capital structure.

Using Hofstede’s cultural value model, the purpose of this paper is to investigate how Chinese employees’ cultural values differ according to firm ownership type such as state-, privately, and US-owned firms.

Data were collected from 367 Chinese employees working at firms located in Beijing.

Results showed that while Chinese employees in state-owned firms scored the highest in collectivism, those working at privately and US-owned firms scored higher for individualism. The score for long-term orientation was also higher in state-owned firms than in privately and US-owned firms. However, contrary to the expectation, the scores for Chinese employees for power distance in state-owned firms were lower than in the others, while the scores for masculinity in state-owned firms were higher than for the others. Chinese employees in all three types of firms showed lower scores than reported in previous studies for uncertainty avoidance.

This study contributes to a deepened understanding of how the cultural values of Chinese employees differ depending on firms’ ownership types, with significant implications for managers, who do business in China as they seek to establish management practices more closely aligned with the cultural values of Chinese employees.

This study may be the first attempt to examine how Chinese cultural values differ according to various ownership types. It suggests that Chinese employees at privately and US-owned firms have different cultural values from employees at state-owned firms, even though all three groups of employees are Chinese.

This paper aims to study how state ownership influences the innovation process in terms of allocating resources toward searching for new solutions and converting these efforts into economic value. On one hand, deep pockets of the state provide slack resources that may facilitate risk taking and innovation. On the other hand, soft budgets can create incentive problems and dampen the efficient use of resources. The authors suggest how accounting for competitive context can disentangle these countervailing forces.

The authors use a panel of over 240,000 Chinese firms over the years 2004–2008. The broad sample and period afforded substantial variability in terms of state ownership within and across firms. The authors use a two-stage model and a within-firm (i.e. fixed-effects) design, controlling for all time-invariant firm characteristics and the problematic unobserved heterogeneity that can often lead to erroneous inferences. Furthermore, the relatively short window limits the likelihood of time-varying unobserved firm characteristics biasing the empirical results.

The authors found that private-sector competition has the opposite effect on the relationship between state ownership and the second step of the innovation process. In industries where there is robust private-sector competition, state ownership diminishes the firm’s ability to convert R&D efforts into economic value. Private-sector competition competes away any advantages state-owned firms may have in terms of developing or accessing the complementary resources needed for commercialization. Ultimately, the inefficiencies of state ownership in terms of relatively undisciplined selection and monitoring of R&D activities outweigh any potential resource advantages derived from state ownership.

The state remains a prominent player in many economies throughout the world. The authors explored how state ownership of firms influences the resources they expend in searching out new solutions, and their success in converting such resources into economically valuable new products and services. State ownership has potentially countervailing effects on innovation. The authors disentangle these countervailing effects through consideration of how accounting for competitive context could determine whether the beneficial effects of state ownership dominate its detrimental effects for both searching for new solutions and converting these efforts into economically valuable new products. With a focus of market competition as an external force that drives the difference in innovation between SOEs and the private-sector, this study serves as a parallel effort to Jia et al. (2019) who investigate the joint effect of public and corporate governance on SOEs’ innovation performance, and Zhou et al. (2017) who concern the balance of the institution and efficiency logics on the comparative advantage of SOEs over privately owned enterprises in innovation performance.

The purpose of this paper is to examine the role of state ownership on financial reporting quality regarding the characteristics of conservatism and earnings management.

Using a large sample of public and private European firms during the period 2003-2010, the authors test the hypotheses following Ball and Shivakumar’s (2005) model for conservatism and the modified Jones (1991) model proposed by Dechow and Sloan (1995) for earnings management. To ensure that the results are robust, the authors conduct sensitivity analysis with regard to potential endogeneity and selection bias.

The authors find that state-owned firms are less conservative than non-state-owned firms, which is consistent with the idea that there is less need for accounting conservatism due to government protection. The authors also show that capital markets play an important role in shaping the relation between state ownership and earnings management. Among public firms, the authors find that state-owned firms have higher abnormal accruals and worse accruals quality than non-state-owned firms, which suggests that state-owned firms are not immune to capital market pressures.

The study has two limitations. First, as state-owned and non-state-owned firms face quite different incentive structures, management behavior might be determined by factors that have yet to be identified. Second, prior research results suggest an inverted U-shape relation between ownership concentration and earnings management (Ding et al., 2007). It would be interesting to investigate the impact of different levels of state ownership on earnings quality.

As the paper investigates the role of state ownership on earnings quality using a sample of European firms, it brings new insights regarding the role of state ownership in accounting quality and firm performance. In addition, it considers the role of capital markets in the relation between the quality of financial reporting and ownership by considering a sample with both public and private firms.

The study contributes to the debate about state intervention in the corporate sector, by extending the knowledge of the effects of government ownership on earnings quality by using a large sample of European firms. Furthermore, the authors also introduce the effect of capital market forces on managers’ behavior in state-owned and non-state-owned companies by analyzing private and publicly listed firms.

The purpose of this paper is to examine whether corporate ownership affects corporate capital structure. This study also seeks to find out whether there is difference in dynamics of the capital structure between these two groups of firms.

Based on panel data of China's listed firms from 1998 to 2007, this paper employs a static empirical model to validate the difference in capital structure between these two groups of firms, and then, a dynamic empirical model is used to explore the dynamic adjustment of the capital structure.

The empirical results show that there is structural difference in static capital structure between state-owned and private listed firms. Further study results tell us that the adjustment to an optimal capital structure is to be faster for the private firm than for the state-owned firm.

The findings suggest that compared with state-owned firms, private firms face higher financial friction in financing activities, but have more incentive to adjust toward optimal capital structure to maximize the shareholders' benefit. This study offers insights to corporate managers interested in privatization, when a state-owned firm is privatized, that firm becomes subject to the disciplining forces of the market and more active to pursue maximum market value of the firm, thus the adjustment to an optimal capital structure to be faster for private firm than for state-owned firm.

This paper for the first time looks at the influence of ownership on capital structure, from both static and dynamic perspective. And this study is helpful for regulators, and corporate managers to understand the corporate financial management behavior.

The purpose of this paper is to investigate how disclosure quality affects the relation between chief executive officer (CEO) power and the variability of firm performance. Moreover, it also examines the impacts of ownership structure and disclosure quality on the relationship between CEO power and performance variability.

Empirical research was carried out.

It was found that: first, firms whose CEOs have more power will exhibit higher performance, but display more variability in firm performance. Second, disclosure quality can affect the relationship between CEO power and the variability of firm performance and more specifically, increase in disclosure quality reduces the performance variability caused by CEO power. Third, the effects of CEO power on the variability of firm performance are higher in state‐owned firms than in non‐state‐owned firms. Moreover, the effect of higher disclosure quality for lowering the variability of firm performance is stronger in state‐owned firms than in non‐state‐owned firms.

First, the authors find that when evaluating corporate governance practices, both firm performance and the variability of firm performance should be taken into account. Second, this paper fills the void in the extant literatures by demonstrating that CEO power, as well as disclosure quality, can affect firms' operational risk. Third, for firm owners, when firms are facing large uncertainty from institutional environment, a great trade‐off between firm performance and operational risk, when determining the degree of CEO power, will play an important role in corporate governance.

This paper complements the extant literatures by examining the impacts of CEO power to firm output from the dimensions of both firm performance and operational risk; and by examining the impacts of ownership structure and disclosure quality on the relationship between CEO power and performance variability.

The purpose of this paper is to examine how corporate governance instruments impact firm value in the context of Pakistan. This paper considers state- and non-state-owned enterprises and examines whether the influence of corporate governance on firm value varies across firms having different nature of ownership.

This study opts for an unbalanced sample of state- and non-state-owned enterprises for the period 2010-2014. Panel data regression is adopted for estimation of main results. The suitable model, i.e. fixed and random effect model, is selected using Hausman specification test.

The notable findings show that board independence has a significant and positive relationship with firm value only for state-owned companies. Furthermore, the results show that market capitalization and return on assets have a significant and positive association with firm value for both state- and non-state-owned enterprises. All other variables are found insignificant for both state- and non-state-owned companies, but the results are consistent with those reported in previous studies.

The findings of the study suggest that fair induction of independent directors, appropriate board size and cost-benefit analysis to conduct frequent meetings can help corporations to improve their performance.

This study is adding to the current literature by providing new insights and shows that the impact of corporate governance on firm value varies across firms of different types of ownership, i.e. state- and non-state-owned enterprises.

The purpose of this paper is to revisit causal effects and investigate hysteresis effects of lean production on performance. With a focus on firm heterogeneity, this paper explores the role of organization ownership structure in shaping the relationship between lean production and performance.

The propensity score matching (PSM) model combined with difference-in-difference (DID) estimation is applied to minimize selection bias caused by firm heterogeneity and endogeneity problems derived from unobserved fixed variables that could potentially affect the desired causal relationship.

Results show that lean production has no significant effect on business performance; however, the relationship between lean production and operations performance is positive and significant, especially for non-state-owned firms. Furthermore, the non-significant effect of lean production on performance of state-owned firms is largely due to the failure of lean production implementation. Meanwhile, lean production can only improve operations performance of non-state-owned firms in the short term due to their inability to continuously implement lean production.

This paper only covers manufacturing listed firms in China. Further studies are needed to test the wide implications of this paper in other countries.

This paper may help managers to identify problems in the implementation of lean production for different organization ownership structure firms, thus providing new insight into the implementation of lean production.

This paper appears to be the first one to examine causal effects of lean production on performance in China by applying the PSM model combined with DID estimation.