Doug Guthrie

The Rise of SASAC: Asset Management, Ownership Concentration, and Firm Performance in China's Capital Markets

Since the mid 1990s the State‐Owned Assets Supervision and Administration Commission (SASAC) has emerged as a key institution governing firm ownership in China, but its impact on firm performance is understudied. Through an analysis of Chinese firms listed on the Shanghai and Shenzhen stock exchanges from 1994–2003, we examine how the changing ownership patterns following the rise of SASAC influenced firm performance. We have three findings. First, contrary to the popular view that state ownership in Chinas listed firms has declined, we find that the state shares have been moved from the original state offices to the SASAC in the format of ‘state institutional shares’. Second, compared with the old state shares, the SASAC institutions affect firm performance more positively. Third, after controlling for state and SASAC ownership, ownership concentration is a strong positive factor in firm performance. Our findings fit squarely within a long tradition of agency theorists who argue that ownership concentration helps solve the free‐rider problem and thus has positive effects on firm performance. However, we focus on the ways in which ownership concentration allows firm owners to monitor and stabilize firm behaviour, which has more important implications for emerging economies such as Chinas domestic capital markets.

Chinese Business Groups: The Structure and Impact of Interfirm Relations during Economic Development

This book provides an account of the emergence of business groups in China and details their organizational structure. It contributes to our understanding of the function of these groups by isolating and examining the relationship between various aspects of group structure and the financial performance of member firms.

Business Organizations in China

For two-and-a-half decades, China’s transition to a market economy has produced remarkable growth rates and fundamental changes in the organization of economic action.1 Though lacking the fundamental institutional shifts that have defined many transforming socialist economies around the world, China’s gradualist reforms have nevertheless been radical and deep (Naughton, 1995; Guthrie, 1999, 2003, 2005; Nolan, 2004). The emergence of business organizations in China has played a key role in the transformation of the Chinese economy. In order to understand the emergence of the capitalist business organizations in China today, we must first examine the varieties and types of organizations that have come to function like business organizations. Once we have identified the organizational forms that fall under the rubric of business organizations in China, it is also crucial to examine the forces that have brought about this process of change. This chapter will take up both agendas. In the Chinese context, it is far too simplistic to think of business organizations as only covering private enterprises in the economy; this sector, while important, comprises only one of the organizational types that are behaving like business organizations in China today. In this chapter, we focus our attention on four types of organizations that comprise the category mainland Chinese business organizations. State-owned enterprises (SOEs), township and village enterprises (TVEs), private enterprises and foreign-funded enterprises are all part of the group of Chinese organizations that behave, to varying degrees, like business organizations China. We also focus our attention on the institutional changes that have shaped business organizations in China today. Specifically, we look at (1) the evolution of government–enterprise relationships, (2) the impact of foreign direct investment (FDI), (3) the transformation of social relationships in China’s market economy, and (4) the emergence of business associations. Through each of these areas of change, we address the question of the forces that have shaped the emergence of Chinese business organizations.

Asset management and productivity in reform-era China

In the spring of 1995, the Electronics Bureau of Shanghai [Shanghai Dianziju] changed its name to “Shanghai Electronics State-Owned Asset Management Company” [Shanghai dianzi guoyou zichan jingying gongsi]. As one official in the former Bureau explained, it had changed its name and its function: It was no longer set up to “govern” or “manage” [guan] Shanghais electronics sector; instead it was now an asset management company whose function was to manage the assets of the firms that it owned.1 At the time, the transformation seemed purely cosmetic. Calling itself an asset management company instead of a government bureau was one thing, but actually acting like an asset management company was quite another. Would firms under this former Bureau be any more productive as a result of the change? Would the work-life experiences of the people actually working in these firms change at all as a result?

One Country, Two Societies: Rural-Urban Inequality in Contemporary China:

Gender inequality remains both a pressing social issue and a fruitful area of social science research. This edited volume seeks to examine gender inequality and the production of well-being in Europe from an interdisciplinary perspective that is perhaps more feminist economics than sociology. The chapters draw on historical and contemporary European examples and offer a somewhat different take (both theoretically and methodologically) on what is usually found in American sociology journals. This book takes a broader view on gender inequalities and the production of wellbeing, with the ‘‘capability approach’’ serving as the theoretical connection between the chapters. The chapters reemphasize that social reproduction is more complex than the production of goods. The various authors also call for and (in the empirical chapters) take into account the socio-political and economic context. An entire chapter is dedicated to the introduction of the capability approach (Chapter Two). But the description of the theory remains lacking amidst numerous references that point the reader towards clarification elsewhere. The authors posit that well-being is an important outcome, and that the production of well-being itself needs to be included in the study of gender inequality (Chapter One), while also demanding that women are not just another vulnerable group (Chapter Four). Chapter Three further challenges conventional notions about the evolution of the ‘‘modern family’’ in the wake of the industrialization process, and argues that the fragility of families is not a novel concept. These theoretical chapters call for a more multidimensional assessment of gender inequality, and remind readers of the importance of the concept and production of well-being. The topics covered in the two empirical parts of the book are very diverse in terms of subject, methodology, and historical time period. The first empirical section ‘‘Gender Care and Work’’ is held together by the challenge to the idea of women as passive victims and in need of assistance. Chapter Five demonstrates widows’ relative economic independence in urban Sweden and Finland from 1890 to 1910, and Chapter Six shows the centrality of female relatives in caring for extended family members in times of crisis. Chapter Seven reaffirms the idea that intergenerational support is not one-sided, and those often thought of as needing care due to older age are also givers of care and other forms of support. The findings from the chapters emphasize the importance of non-monetary transfers outside the market system. The theme of caregiving is readdressed in later chapters which illustrate how home caregiving in Belgium is situated between the public/market divide (Chapter Nine) and the problems of combining market work with caregiving, especially for those in the ‘‘sandwich generation’’ (Chapter Ten). In a seeming departure from studies in the capability approach tradition, Chapter Eight is a more typical time-use study that examines the gender asymmetry in unpaid labor in Italy. The results are not novel as women are found to do more unpaid work, especially in couples with children. The second empirical part of the book focuses on the intra-household allocation of resources. Three of the five chapters in this section center primarily on the nineteenth century, examining consumption patterns in Spain (Chapter 11), gender differences in children’s schooling in Switzerland (Chapter 12), and the differences in the treatment of and opportunities for celibate men and women in the Pyrenees (Chapter 13). These chapters illustrate gender differences, but not in