China’s WTO Accession and Long-Term Profitability of Chinese Firms
<title>Abstract</title> As emerging economies integrate their markets with the rest of the world, competition-driven changes in profitability are increasingly affected by shocks of various types from the business environment. We examine the dynamics of profitability distributions under such conditions using China’s WTO accession as a natural experiment to carry out before and after comparisons. Our results suggest that after WTO accession, the long-run (ergodic) distribution of conditional profitability rates of Chinese firms has become more dispersed. Due to the large proportion of firms at the poor performance end, this suggests that the financial stability of the Chinese economy will be endangered if the business environment were to deteriorate. There is an urgent need to reduce the widening span of the distribution of profitability at the lower end by accelerating the restructuring of Chinese companies.
Year of publication: |
2012
|
---|---|
Authors: | Jiang, Neng ; Kattuman, Paul A. |
Published in: |
International Journal of the Economics of Business. - Taylor & Francis Journals, ISSN 1357-1516. - Vol. 19.2012, 1, p. 53-73
|
Publisher: |
Taylor & Francis Journals |
Saved in:
Online Resource
Saved in favorites
Similar items by person
-
Intensity of competition in China : profitability dynamics of Chinese listed companies
Jiang, Neng, (2011)
-
Intensity of competition in China : profitability dynamics of Chinese listed companies
Jiang, Neng, (2010)
-
China's WTO accession and long-term profitability of Chinese firms
Jiang, Neng, (2012)
- More ...