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The Effect of Firm Ownership Structure on Performance: A case study of Eastern Europe and Central Asian Countries

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  • Bekena, Sisay Menji

Abstract

This paper uses World Bank Enterprise Survey 2009 and 2013 panel data for Central Asia and Eastern Europe to estimate the casual effects of firm ownership structure on firm performance measured by the growth rates of sales, labor productivity and employment. The study uses treatment effect models to compute the average treatment effects. Estimation results using propensity score matching show that on average private firms have sales and employment growth rates that are 6 percentage points higher compared to public firms. The effect is statistically significant at conventional significance levels. Labor productivity growth is similar across public and private firms. The key conditional independence assumption necessary for the validity of the matching models is found to be valid and the computed casual effects are consistent across the different treatment effect models.

Suggested Citation

  • Bekena, Sisay Menji, 2017. "The Effect of Firm Ownership Structure on Performance: A case study of Eastern Europe and Central Asian Countries," MPRA Paper 82706, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:82706
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    File URL: https://mpra.ub.uni-muenchen.de/82706/1/MPRA_paper_82706.pdf
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    References listed on IDEAS

    as
    1. Curtiss, Jarmila & Ratinger, Tomáš & Medonos, Tomáš, 2012. "Ownership and Investment Behaviour in Transition Countries: A Case Study of Collective and Corporate Farms in the Czech Republic," Factor Markets Working Papers 121, Centre for European Policy Studies.
    2. Panayotis Kapopoulos & Sophia Lazaretou, 2007. "Corporate Ownership Structure and Firm Performance: evidence from Greek firms," Corporate Governance: An International Review, Wiley Blackwell, vol. 15(2), pages 144-158, March.
    3. John Asker & Joan Farre-Mensa & Alexander Ljungqvist, 2011. "Comparing the Investment Behavior of Public and Private Firms," NBER Working Papers 17394, National Bureau of Economic Research, Inc.
    4. J. David Brown & John S. Earle & Almos Telegdy, 2006. "The Productivity Effects of Privatization: Longitudinal Estimates from Hungary, Romania, Russia, and Ukraine," Journal of Political Economy, University of Chicago Press, vol. 114(1), pages 61-99, February.
    5. Curtiss, Jarmila & Ratinger, Tomas & Medonos, Tomas, 2012. "Ownership and Investment Behaviour in Transition Countries: A Case Study of Collective and Corporate Farms in the Czech Republic," Working papers 122841, Factor Markets, Centre for European Policy Studies.
    6. Shahidur R. Khandker & Gayatri B. Koolwal & Hussain A. Samad, . "Handbook on Impact Evaluation : Quantitative Methods and Practices," World Bank Publications, The World Bank, number 2693, September.
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    More about this item

    Keywords

    Firm ownership; Treatment Effects;

    JEL classification:

    • D20 - Microeconomics - - Production and Organizations - - - General

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