Abstract
ABSTRACT This paper investigates the impact of non-state-shareholders on the labor redundancy of state-owned enterprises (SOEs). We find that the participation of non-state shareholders helps to reduce the labor redundancy in SOEs. Specifically, non-state shareholders cannot reduce the labor redundancy in SOEs only with holding shares, while they can effectively mitigate the labor redundancy problem by appointing directors to the board. Furthermore, we find that non-state shareholders play a greater role in reducing the labor redundancy for highly labor-intensive SOEs and firms with strong government intervention. Finally, we document that non-state-shareholders help improve the operational and financial performance of SOEs.
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