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Large state-owned shareholders and social insurance contributions in private firms: Evidence from China

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  • Wu, Ying

Abstract

In the context of transitioning toward market-oriented economies, does state-owned capital continue to safeguard the public interest? This paper answers this question by examining how large state-owned shareholders influence social insurance contributions in private firms. Using a comprehensive sample of Chinese listed firms from 2012 to 2022, this paper finds that the presence of large state-owned shareholders significantly increases social insurance contributions in private firms. This finding remains valid after a battery of robustness tests. Mechanism tests show that large state-owned shareholders increase social insurance contributions by helping private firms obtain government resources and strengthening oversight of social insurance compliance. However, this paper finds no evidence that foreign investors or unions influence the relationship between large state-owned shareholders and social insurance contributions in private firms. The findings of this paper suggest that state-owned equity prioritizes workers' interests over profit maximization. Given that expanding corporate social insurance coverage is a common challenge in emerging markets, this paper provides valuable policy implications for regulators in similar economic contexts.

Suggested Citation

  • Wu, Ying, 2026. "Large state-owned shareholders and social insurance contributions in private firms: Evidence from China," Emerging Markets Review, Elsevier, vol. 70(C).
    • Handle: RePEc:eee:ememar:v:70:y:2026:i:c:s1566014125001475
    DOI: 10.1016/j.ememar.2025.101398
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    JEL classification:

    • G30 - Financial Economics - - Corporate Finance and Governance - - - General
    • G32 - Financial Economics - - Corporate Finance and Governance - - - Financing Policy; Financial Risk and Risk Management; Capital and Ownership Structure; Value of Firms; Goodwill

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