The relationship between ownership and growth

Abstract

The purpose of this paper is to investigate the relationship between ownership and employment growth. With a sample of 5,461 firms and using the Heckman two-stage model (to eliminate selection sample bias), the main findings are follows: Compared to firms with 100% capital ownership, domestic firms with less than 50% state capital, domestic private firms, joint stock firms without state capital, 100% foreign capital firms, and joint venture (non-state and foreign) firms have positively significant impacts on employment growth. A change in ownership is not significant to employment growth. The rest of this paper is organized as follows: Section 2 gives a literature review and some previous empirical evidence. Section 3 provides the econometric model for estimating firm growth. In Section 4, the data is described. Section 5 presents empirical results of the relationship between ownership and growth in Vietnam. The final section gives conclusions and policy implications.