What is the benefit of TMT's governmental experience to private-owned enterprises? Evidence from China

Haizhen Wang, Jie Feng, Xinmei Liu, Ruoyong Zhang

Research output: Contribution to journalArticlepeer-review

22 Scopus citations

Abstract

In China, the phenomenon of government officials entering business (xiahai)-government officials leave government organizations to enter into private-owned enterprises (POEs)-gives rise to an intriguing question: Why do POEs invite the participation of former government officials? Based on a sample of 100 Chinese POEs, our findings indicate that both the mean number of years of top management team's (TMT) governmental experience and the number of top managers with governmental experience in a TMT are positively related to a POE's political networking, which in turn contributes to POE performance. By doing so, this study adds governmental experience to the literature on TMT experience, and identifies the mechanism of governmental experience effect. Overall, we provide an underlying mechanism of the phenomenon of government officials entering business.

Original languageEnglish (US)
Pages (from-to)555-572
Number of pages18
JournalAsia Pacific Journal of Management
Volume28
Issue number3
DOIs
StatePublished - Sep 2011
Externally publishedYes

All Science Journal Classification (ASJC) codes

  • Business and International Management
  • Economics, Econometrics and Finance (miscellaneous)
  • Strategy and Management

Keywords

  • Firm performance
  • Governmental experience
  • Political networking
  • Top management team (TMT)

Fingerprint

Dive into the research topics of 'What is the benefit of TMT's governmental experience to private-owned enterprises? Evidence from China'. Together they form a unique fingerprint.

Cite this