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Measuring the State Sector and Assessing Its Effectiveness: Approaches and Implications

Author

Listed:
  • Aleksandr E. Abramov

    (RANEPA, Moscow, Russian Federation)

  • Andrei A. Pershin

    (RANEPA, Moscow, Russian Federation)

  • Maria I. Chernova

    (RANEPA, Moscow, Russian Federation)

Abstract

Despite the increasing role of the state sector in the economies of many countries, the criteria and approaches to comparative analysis and evaluation of the performance of state-owned enterprises are still ambiguous, as are the methods for cross-country comparisons of the scale of state presence in the economy. The purpose of the article is to systematize the main approaches to measurement of the size of the state sector using Russian economy as an example, as well as to substantiate the significance of this information in assessing the performance of companies with different forms of ownership in the investment and managerial decision-making process. The problems of the information environment, such as the fragmentation of data, incomplete publication of company reports, and the specifics of national databases in different countries, complicate and distort empirical research. Meanwhile, there are significant differences in the performance of state-owned and private companies, as well as in their investment attractiveness to investors in the financial market. International approaches to solving these problems consist in the formation of consolidated and unified databases, inclusion of stateowned companies in the system of national accounts, and creation of guidelines on uniform principles of transparency and accessibility of financial reports. Given the growing restrictions on access to information along with the trend towards the growth of the state sector in Russia, there is an increasing need to develop a unified methodology to measure its scale and assess its impact on the economy, investment and stock market. The proposed methodology and the obtained empirical results allow not only to comprehensively assess the contribution of the state sector in creating GDP and increasing the capitalization of the stock market, but also to conduct comparative studies of performance indicators and stock returns in companies with different ownership structure, as well as an international empirical analysis of the state sector impact on the economies and the financial and economic performance of companies.

Suggested Citation

  • Aleksandr E. Abramov & Andrei A. Pershin & Maria I. Chernova, 2023. "Measuring the State Sector and Assessing Its Effectiveness: Approaches and Implications," Finansovyj žhurnal — Financial Journal, Financial Research Institute, Moscow 125375, Russia, issue 2, pages 27-46, April.
    • Handle: RePEc:fru:finjrn:230202:p:27-46
    DOI: 10.31107/2075-1990-2023-2-27-46
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    References listed on IDEAS

    as
    1. Marek Dabrowski (ed.), 2023. "The Contemporary Russian Economy," Springer Books, Springer, number 978-3-031-17382-0, September.
    2. Josef C. Brada, 1996. "Privatization Is Transition--Or Is It?," Journal of Economic Perspectives, American Economic Association, vol. 10(2), pages 67-86, Spring.
    3. Abramov, Alexander & Radygin, Alexander & Chernova, Maria, 2017. "State-owned enterprises in the Russian market: Ownership structure and their role in the economy," Russian Journal of Economics, Elsevier, vol. 3(1), pages 1-23.
    4. Szarzec, Katarzyna & Dombi, Ákos & Matuszak, Piotr, 2021. "State-owned enterprises and economic growth: Evidence from the post-Lehman period," Economic Modelling, Elsevier, vol. 99(C).
    5. Beuselinck, Christof & Cao, Lihong & Deloof, Marc & Xia, Xinping, 2017. "The value of government ownership during the global financial crisis," Journal of Corporate Finance, Elsevier, vol. 42(C), pages 481-493.
    6. Abramov, Alexander E. (Абрамов, Александр) & Aksenov, Ivan V. (Аксенов, Иван) & Radygin, Alexander D. (Радыгин, Александр) & Chernova, Maria I. (Чернова, Мария), 2018. "Modern Approaches to Measuring the State Sector: Methodology and Empirics [Современные Подходы К Измерению Государственного Сектора: Методология И Эмпирика]," Ekonomicheskaya Politika / Economic Policy, Russian Presidential Academy of National Economy and Public Administration, vol. 2, pages 28-47, April.
    7. Evguenia Bessonova & Ksenia Gonchar, 2022. "Can the Growth of Competitive Pressure and Hardening of Budget Constraints Reduce the Efficiency Loss due to State Ownership?," Russian Journal of Money and Finance, Bank of Russia, vol. 81(3), pages 22-53, September.
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    More about this item

    Keywords

    state-owned enterprises; state sector; assessment methods; developing countries; scale of state sector;
    All these keywords.

    JEL classification:

    • D20 - Microeconomics - - Production and Organizations - - - General
    • D60 - Microeconomics - - Welfare Economics - - - General
    • G38 - Financial Economics - - Corporate Finance and Governance - - - Government Policy and Regulation
    • H82 - Public Economics - - Miscellaneous Issues - - - Governmental Property
    • H83 - Public Economics - - Miscellaneous Issues - - - Public Administration
    • L30 - Industrial Organization - - Nonprofit Organizations and Public Enterprise - - - General
    • P20 - Political Economy and Comparative Economic Systems - - Socialist and Transition Economies - - - General

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