State-owned enterprises, iop managers, and innovation: evidence from China
- Publication Type:
- Thesis
- Issue Date:
- 2024
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Innovation has long been acknowledged as a key driver for firms to obtain sustainable competitive advantage and, in turn, contribute to national economic development. Recently, research interest in the role of state capitalism, in the form of state-owned enterprises (SOEs) or state ownership, in innovation has grown rapidly. However, the topic of SOE innovation is still underexplored.
The existing literature on state ownership/SOE and innovation is scattered across multiple disciplines with diversified research themes, lacking theoretical and empirical integration. Therefore, in this thesis, I first conduct Study One, a systematic literature review to integrate previous studies. Based on this systematic review, I identify three research gaps in prior studies that need to be addressed in future research. First, previous studies ignore the heterogeneities of SOEs’ leadership. Second, the heterogeneities among SOEs have been largely overlooked. Finally, there is a lack of causal inference studies related to SOE innovation.
To address the above research gaps, I conduct two other empirical studies (Study Two and Three). Specifically, in Study Two, I assess whether CEOs’ private firm experience can improve or impede SOEs’ innovation performance, and further examine the contingent effects of CEOs’ international exposure and level of stateness. In Study Three, I examine how the reductions in pay disparities between managers and ordinary employees within SOEs affect their innovation performance using a quasi-natural experiment, and further investigate the underlying mechanisms and conduct heterogeneity analyses.
This thesis makes several key theoretical and practical contributions. First, through a systematic review of previous studies, this thesis provides a comprehensive understanding of the role of state ownership in innovation. Second, this thesis offers a robust foundation to identify key research gaps in existing literature and sets a future research agenda. Third, by considering CEOs’ private firm experiences, this thesis draws attention to the important but largely overlooked role of individual-level attribute of SOE leadership in shaping innovation and provides a novel lens to compare the heterogeneity among SOEs. Furthermore, through the adoption of a quasi-natural experiment, this thesis sheds light on the causal effect of pay disparity on SOE innovation performance as well as its underlying mechanisms, which are underestimated in SOE innovation studies. In terms of practical implications, this thesis highlights the significance of SOE managers and policymakers to prioritize the development of leadership within SOEs and cultivate an environment of pay equity, to boost firm innovation.
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