Enterprise employees’ education and mixed ownership reform

CHEN Lin1 LI Hujia1

(1.Institute of Industrial Economics, Jinan University)

【Abstract】To develop mixed-ownership economy and to improve employees’ education are the two important strategies for socioeconomic development in recent years. Whether these two strategies interact with each other? Will employees’ education of state-owned enterprises be affected by the mixed ownership reform? If so, which industries or fields will be more affected? This paper calculates the market power of each firm, and then examines the interaction of mixed ownership reform and market power on investment in employees’ education. The results show that, there is a significant “catfish effect” in employees’ education for mixed ownership enterprises. Only when the market power (monopoly) is relatively weak and the market competition is relatively fierce can the mixed ownership reform release certain policy dividends and enhance the enthusiasm of employees’ education. However, for the state-owned enterprises with stronger market power, the reform shows some policy uncertainties which weaken their investment in employees’ education. Hence, it is imperative to establish a top-level design that takes the interaction between the two policies into account.

【Keywords】 employees’ education; on-the-job training; mixed ownership reform; market power;

【DOI】

【Funds】 Key Project of National Social Science Fund (16ZDA026)

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    Footnote

    [1]. ① In the current enterprise accounting standards, the expenses paid by enterprises for employees to learn advanced technology and improve their educational level is the investment in employees’ education. Provision 47 in Chapter Five of Professional Education and Training in Law of the People’s Republic of China on Promoting Employment states that enterprises shall, in accordance with the relevant provisions of the state, withdraw funds for the education of employees, and provide vocational skills training and continuing education for employees. Provision 67 of Chapter Eight “Legal Responsibilities” states that if an enterprise violates the provisions of this law, fails to withdraw employees’ education funds in accordance with state regulations, or misappropriates employees’ education funds, the labor administrative department shall order it to make corrections and impose penalties according to law. [^Back]

    [2]. ① The investment in employees’ education in Chinese Industrial Enterprise Database only has data from 2004 to 2007. However, when the paper uses the DLW method to measure the market power index, it needs to use the lag period variable. To ensure the sample size, this paper first estimates the market power of database enterprises from 2003 to 2007, and carries out further empirical researchaccordingly. [^Back]

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This Article

ISSN:1000-7881

CN: 11-1043/C

Vol , No. 06, Pages 92-102+128

December 2018

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Article Outline

Abstract

  • 1 Introduction
  • 2 Theory and hypotheses
  • 3 Research design
  • 4 Empirical test
  • 5 Conclusion and enlightenment
  • Footnote

    References