The Efficiency Difference And Trend Analysis Between State-owned And Foreign Funded Industrial Enterprises

From the beginning of the reform of state-owned enterprises since 1978, the output of China's state-owned enterprises have maintained a high growth rate, China has become the biggest bright spot in the economic transition period. And, with the output growth, the productivity of China's state-owned enterprises has improved to a considerable extent. However, output growth and the improvement of efficiency of state-owned enterprises in China can not conceal the problems facing: State-owned enterprises accounted for the entire decline in the proportion of the gross industrial, and faced badness of financial status, however the annual growth rate of output by non-state-owned enterprises and contributions of China's industrial output's stock and the incremental was increasing year by year. Well, has the 20 years of gradual reform of state-owned enterprises achieve success in the end? After the reform of state-owned enterprises and non-state-owned enterprises still have difference, what is causing this difference? All of these have become the topic of heated debate in economic circle.Before 1978, China's state-owned enterprises operating under state planning have no power to make decision. From 1978, China began to carry out a comprehensive reform of state-owned enterprises. The state-owned enterprise's reform has undergone the course from permissive management to institution innovation. Undeniably, after the past 20 years of state-owned enterprises reform have made remarkable progress and effectiveness. State-owned enterprises have raised productivity growth, improved the distribution of the production and investment sector. However, some problems still exist in state-owned enterprises. Phenomenon of overheated investment in fixed assets, a low rate of return, substantial capital precipitation and soaring stock plays a more and more important role. Historical reasons have caused the problems that surplus to the state-owned enterprises and society burden. Compared with the state-owned enterprises, non-state-owned enterprises in the past 20 years, developed rapidly, won a great achievement. According to statistics, in 2005, non-state-owned industrial enterprises' proportion of the total industrial output value has reached 66.71%; accounted for 72.81% of the total working population. The proportion of the total amount of social consumer goods in 2005 was around 80%. Meanwhile, the state economy is getting smaller and smaller share of output. The total industrial output value of state-owned enterprises share fell from 77.63% of 1978 to 33.28% of 2005. Comparative data shows a very obvious fact—for the entire state-owned enterprises gradually diminished role in boosting economic development. Non-state-owned enterprises have become the most dynamic economy in the new bright spot; gradually replace the state-owned enterprises and have become the 'engine' of economy development. The shrinking of the state-owned enterprises and expanding of non-state-owned enterprises cause by the difference in efficiency. So what caused this difference in efficiency? Is it really is doomed to low efficiency of state-owned enterprises? These are of concern to economists and controversial issues.Nowadays, efficiency measure estimation model mainly has two methods. There are single-factor productivity analysis and model function analysis. However, information that single-factor productivity analysis will provide is very limited and unilateral. It is difficult to accurately reflect efficiency improvement. Model function analysis can have different results with different model form. As regarded to comparative result, it seems that the existing literature on the efficiency difference between the two types of enterprises only stays in the reasons explained. The trend analysis of the efficiency difference between state-owned enterprises and non-state-owned enterprises is absence. As regarded to data choosing, most documents select the micro-enterprise level data .This sample selection to the starting point for the thesis can only explain part of the efficiency of state-owned enterprises is not high, However, conclusions should be extended to all state-owned enterprises is more difficult. Based on analysis of the efficiency different between enterprises of different ownership are inadequate. Therefore, this paper selects the DEA model that is free from model form, to measure efficiency. Reference substance chooses foreign funded industrial enterprises; The data choose from 31 provinces of 1999-2005 in China. Hope to examine the issue from the overall perspective. Based on the data from 31 provinces, we construct the production frontier of two types. Economic growth of two types of enterprises is compared with production frontier. And the input component-efficiency will be further decomposed into pure technique- efficiency, size- efficiency, the input disposition-degree; consequently we can comprehensively study the input component-efficiency difference.Comparison between the two types of enterprises' efficiency, we can get the following conclusions:1, The laboratory comparative method results.(l)In 1999-2005, state-owned and state-holding industrial enterprises, foreign funded industrial enterprises have no significant statistical difference in pure technique- efficiency. It is means that two type enterprises' production technology and management level have no significant difference. But contrast mean, state-owned and state-holding industrial enterprises in 1999 is still a big difference with foreign-funded industrial enterprises, But in 2005 had significantly narrowed. (2) size- efficiency between two type enterprises have significant differences among 1999-2001, 1999, 2001 have the same situations, are due to the shortage of disposal capacity factor that cause state-owned and state-holding industrial enterprises scale inefficiency, but in 2000, the over-investment of foreign-funded enterprises caused the falling efficiency of the scale. (3) Input disposition-degree of state-owned and state-holding industrial enterprises was significantly lower than foreign funded industrial enterprises. (4) Comparative analysis of the input component-efficiency is that state-owned and state-holding industrial enterprises is significantly less than foreign funded enterprises, but the disparities is reducing..2, The vertical comparative results. (1) Foreign funded industrial enterprises are relatively stable with no major changes occur among 1999 with 2005. From this, we can see that narrowing the disparities between the two type enterprises is due to the increasing efficiency of state-owned enterprises and state-holding enterprises. (2) In the process of reconstruction process of property right, the efficiency of state-owned and state-holding industrial enterprises maintained a rising trend. Pure-state-owned industrial enterprises capital continued to withdraw. The state-controlled industrial enterprises continue expansion in the capital. So, the direction of reform and efficiency i improving is the same. It clears that the positive effect of changes in property rights.