Research on the Institutional Resistance of Mixed Ownership Reform: Based on the Perspective of Local Government Performance Pressure

Abstract

In recent years, the reform of mixed ownership has become an important breakthrough in the reform of state-owned enterprises. However, the mixed ownership reform of state-owned enterprises has encountered some resistances. These resistances include not only the obstruction of vested interests, the solidification of ideology, public concern, but also the outdated incentive model and institutional design. At present, there are relatively few studies on the influencing factors of how to effectively promote the reform of mixed ownership and the empirical evidence of large samples is lacking. As the executor of the mixed ownership reform, local governments’ behavior and willingness will have a profound influence on the effect of the mixed ownership reform. So this paper selects performance pressure which has the greatest influence on local government policy behavior as the breakthrough point, manually collecting and organizing the property right information of the top ten shareholders. Taking A-share local state-owned listed companies in China from 2007 to 2016 as research samples, using mixed subject depth and hybrid equity balance degree to measure the level of mixed ownership reform of state-owned enterprises, this paper studies the influence of local government performance pressure on the mixed ownership reform of state-owned enterprises. The study finds that the greater the local government performance pressure, the lower the degree of mixed ownership reform of state-owned enterprises. At the same time, the influence of performance pressure on the mixed ownership reform of local state-owned enterprises is different in object selection. Based on the balance between intervention costs and intervention benefits, local governments are more inclined to hinder the process of mixed ownership reform of state-owned enterprises with fewer levels of the pyramid and heavier policy burden. As the decision-making process of the government is completed by officials, the motivation of officials is not only derived from the external performance pressure, but also related to the internal individual heterogeneity. Therefore, this paper further combines the heterogeneity of local officials and finds that the restraining effect of local government performance pressure on the mixed ownership reform is more obvious in the samples with young age, long tenure or enterprise service experience. Finally, this paper systematically studies how to promote the mixed ownership reform of state-owned enterprises.