Complex state ownership, competition, and firm performance – Russian evidence

Show full item record

Permalink

Citation

Liljeblom , E , Maury , B & Hörhammer , A 2019 , ' Complex state ownership, competition, and firm performance – Russian evidence ' International Journal of Emerging Markets . https://doi.org/10.1108/IJOEM-08-2017-0287

Title: Complex state ownership, competition, and firm performance – Russian evidence
Author: Liljeblom, Eva; Maury, Benjamin; Hörhammer, Alexander
Contributor: Hanken School of Economics, Finance, Helsinki
Hanken School of Economics, Finance, Helsinki
Belongs to series: International Journal of Emerging Markets
ISSN: 1746-8809
Abstract: Purpose – State ownership has been common especially in industries with restricted competition. In Russia, state controlled firms represent around 41% of the market value of all listed firms (Deloitte, 2015). Yet, there is a significant gap in the literature regarding the effects of various forms of government control in listed firms. The purpose of this study is to fill this gap by exploring the impact of the complexity of state ownership and competition on the performance of Russian listed firms. Design/methodology/approach – The sample consists of data for 72 firms (360 firm-years) in the Russian MOEX broad market index during 2011-2015. The complexity of state ownership is captured by studying forms of state control including majority/minority, direct/indirect, federal/regional, mixed structures, and golden shares. Findings – We find significant differences in performance relating to different forms of state ownership. State control is negatively related to firm valuation and the sales/employees ratio. Performance is weakest when state ownership takes the form minority, regional, or direct ownership. State control through golden shares typically outperforms other state controlled firms. We find indications of employment prioritization beyond the economical optimum. In addition, the relation between state ownership and profitability becomes positive in sectors where state firms appear to enjoy lower competition. Originality/value – While the effects of state ownership have been studied on many markets, there is a lack of studies on the effects of different forms, or the complexity, of state ownership beyond direct and indirect ownership. We contribute to the literature on the performance effects of state ownership by studying a multitude of forms of governmental ownership as well as the role of competition in Russia. Especially the profitability of state controlled firms is significantly affected by industry characteristics. Implications of the results are discussed both from firm and policy maker perspectives.
Date: 2019-07-30
Subject: 512 Business and Management
Firm performance
State ownership
Competition
Russian owners
KOTA2019?
PREM2019_08
2 - Hybrid open access publication channel
1 - Self archived
https://helda.helsinki.fi/dhanken/handle/10227/256405
1- Minst en av författarna har en utländsk affiliation
1- Publicerad utomlands
0- Ingen affiliation med ett företag
Rights:


Files in this item

Total number of downloads: Loading...

Files Size Format View
pdf.pdf 246.4Kb PDF View/Open

This item appears in the following Collection(s)

Show full item record