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Asia Pacific Journal of Management

Erschienen in:

01.12.2006

Impact of state ownership and control mechanisms on the performance of group affiliated companies in China

verfasst von: Yuan Lu, Jun Yao

Erschienen in: Asia Pacific Journal of Management | Ausgabe 4/2006

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Abstract

This paper examines the moderating impact of state ownership and group control mechanisms on the relationship between diversification and performance of companies affiliated with large business groups in China. We find that the state ownership has enhanced the performance of group affiliated companies when they adopted higher degrees of diversification. We also find that cash flow rights have a positive impact on the performance of companies with lower degrees of diversification while in general group control rights have a negative impact on the performance. These results suggest that a group’s control mechanisms, derived from pyramid ownership structures, enable the dominant owners to expropriate the value from minority shareholders or tunnel corporate resources for their own interest.

Vorheriger Artikel Business group affiliation and firm performance in a transition economy: A focus on ownership voids

Nächster Artikel Managerial ties, control and deregulation: An investigation of business groups entering the deregulated banking industry in Taiwan

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Titel: Impact of state ownership and control mechanisms on the performance of group affiliated companies in China
verfasst von: Yuan Lu
Jun Yao
Publikationsdatum: 01.12.2006
Verlag: Springer US
Erschienen in: Asia Pacific Journal of Management / Ausgabe 4/2006
Print ISSN: 0217-4561
Elektronische ISSN: 1572-9958
DOI: https://doi.org/10.1007/s10490-006-9017-0

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