Post-Privatization Ownership and Firm Performance: A Large Meta-Analysis of the Transition Literature

Abstract

This paper aims to perform a meta-analysis of the relationship between post-privatization ownership and firm performance using a large database of the transition literature. Baseline estimation of a meta-regression model that employs a total of 2894 estimates drawn from 121 previous studies indicated the superior impact of foreign ownership on firm performance in comparison with state and domestic private entities. However, it did not go as far as to comprehensively verify the series of hypotheses concerning the interrelationship between different ownership types. The estimation of an extended meta-regression model that explicitly controls for the idiosyncrasies of transition economies and privatization policies strongly suggested that differences between countries in terms of location, privatization method, and policy implementation speed are the cause of the opaqueness seen in the empirical results of the previous literature. The definite evidence of the harmfulness of the voucher privatization for ex-post firm performance is one of the most noteworthy empirical findings obtained from the meta-analysis in this paper.