The fief-specific factors in the Chinese economy: The effects of state ownership

Ji LI*, Amy Y Y CHEN, Gui Yao Tang, Lei Fang, Fue Zeng

*Corresponding author for this work

    Research output: Contribution to journalJournal articlepeer-review


    According to the research by Boisot and Child (1988), fief is defined as a transactiongovernance structure with low information codification and diffusion. Based on this definition, this article highlights the existence of fief-specific factors, such as state-ownership, in China's publicly listed firms. It is hypothesised that the state ownership, as a fief specific factor, has a negative effect on product diversification among the listed firms in China. The ownership also has a positive effect on the firms' stock market performance. Moreover, the effects can be moderated by several factors, such as firm size, age and managerial ownership. The authors collected data from listed firms in China and conducted an empirical study to test the hypotheses. The results support the hypothesised effects of the fief-specific factor and demonstrate the importance of studying fief factor to understanding organisational behaviours and performance in China. It is also indicated that the predictive validity of Western theories could be improved by taking into account the effects of fief-specific factors when studying organisational behaviours and performance in an emerging economy such as China. The paper concludes with a discussion of the theoretical and practical implications.

    Original languageEnglish
    Pages (from-to)1-22
    Number of pages22
    JournalJournal of General Management
    Issue number2
    Publication statusPublished - Dec 2010

    Scopus Subject Areas

    • Business, Management and Accounting (miscellaneous)
    • Strategy and Management


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