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Performance Differential between India's State Owned Ratna Companies and Private Owned Enterprises

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  • Abhay S. Nagale

    (VES Institute of Management Studies and Research, India)

Abstract

It is generally believed that state owned enterprises are less profitable and efficient compared to private owned enterprises (POE). The objective of this study is to examine whether there is any difference in the profitability and efficiency of India's state owned Ratna companies and POE. The period in this study spans from 2007 to 2016 and the sample consists of 71 Ratna companies and 332 POE. Return on shareholders fund, return on total assets and productivity of capital are used as measure of performance. The findings show that Ratna companies perform worse that POE.

Suggested Citation

  • Abhay S. Nagale, 2017. "Performance Differential between India's State Owned Ratna Companies and Private Owned Enterprises," International Journal of Economics and Financial Issues, Econjournals, vol. 7(6), pages 138-140.
    • Handle: RePEc:eco:journ1:2017-06-17
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    References listed on IDEAS

    as
    1. Boardman, Anthony E & Vining, Aidan R, 1989. "Ownership and Performance in Competitive Environments: A Comparison of the Performance of Private, Mixed, and State-Owned Enterprises," Journal of Law and Economics, University of Chicago Press, vol. 32(1), pages 1-33, April.
    2. Paul H. Malatesta & Kathryn L. DeWenter, 2001. "State-Owned and Privately Owned Firms: An Empirical Analysis of Profitability, Leverage, and Labor Intensity," American Economic Review, American Economic Association, vol. 91(1), pages 320-334, March.
    3. Eskil Goldeng & Leo A. Grünfeld & Gabriel R. G. Benito, 2008. "The Performance Differential between Private and State Owned Enterprises: The Roles of Ownership, Management and Market Structure," Journal of Management Studies, Wiley Blackwell, vol. 45(7), pages 1244-1273, November.
    4. Wei, Zuobao & Varela, Oscar & Kabir Hassan, M., 2002. "Ownership and performance in Chinese manufacturing industry1," Journal of Multinational Financial Management, Elsevier, vol. 12(1), pages 61-78, February.
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    More about this item

    Keywords

    Performance; Private owned companies; Government linked companies;
    All these keywords.

    JEL classification:

    • G - Financial Economics

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