Rent seeking and government ownership of firms: An application to China's township-village enterprises

被引:48
作者
Che, JH [1 ]
机构
[1] Univ Illinois, Dept Econ, Urbana, IL 61801 USA
关键词
D O I
10.1006/jcec.2002.1800
中图分类号
F [经济];
学科分类号
02 ;
摘要
Using its control of regulated inputs, a government agency extracts rents from a manager who undertakes an investment. Such government rent-seeking activity leads to a typical hold-up problem. Government ownership serves as a second-best commitment mechanism, through which the government agency will restrain itself from the rent-seeking activity and may even offer the manager assistance in the form of tax breaks and subsidies. This mechanism works at a cost, however, as government ownership also compromises ex post managerial incentives and creates distortion in resource allocation. Nevertheless, government ownership Pareto dominates private ownership under certain conditions. These conditions correspond to a host of stylized empirical observations concerning local-government-owned firms, i.e., township-village enterprises, during China's transition to a market economy. (C) 2002 Association for Comparative Economic Studies. Published by Elsevier Science (USA). All rights reserved.
引用
收藏
页码:787 / 811
页数:25
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