Made in China or by China? Corporate Governance and Technolocal Capability Development in the Chinese Electronics Industry-The Survey Evidence

摘要

Using survey data in the Chinese electronics industry, this paper shows how corporate governance and finance affect Chinese firms' technology capability development. There are three major findings :1) ownership structure influences technological capability development: compared to majority (50% or more state share) state-owned or private enterprises, minority (less than 49% state share) state-owned enterprise show significant superiority in technological capabilities; 2) management selection method influences technological capability development: firms with shareholder-selected managers generally outperform technologically and financially, whilst firms with authority-appointed managers under-perform. 3) Intelligent shareholder-engagement leads to intelligent investment/ technological strategy (emphasising low visibility activities), which leads to successful development of technological capability. We therefore conclude that partial privatisation of state-owned enterprise is beneficial to its technological development. However, it is governance practices entailed in engagement that are exerting crucial and direct impact.