Mixed-ownership Reform: Private Firms’Role in Targeted Poverty Alleviation—A Perspective on Resource Complementarity andCheck & Balance

Ding Hui1, He Dongxin1, Jiang Fuwei2,3, Zhang Zhining*1

1 School of Finance, the Central University of Finance and Economics (CUFE), Beijing, China

2 School of Economics, Xiamen University, Xiamen, China

3 Wang Yanan Institute for Studies in Economics (WISE), Xiamen University

Abstract: Targeted poverty alleviation (TPA) serves as a winning formula for fightingpoverty and has generated valuable experiences for achieving common prosperity. Themixed-ownership reform has enhanced corporate economic performance. However,further testing is required to assess whether enterprises contribute to the improvement ofdistribution by participating in TPA. Taking A-share-listed private enterprises between2016 and 2021 as research samples, we conducted an investigation into the extent andmanner in which the mixed-ownership reform contributes to TPA. Our research revealsthat a higher proportion of state capital equity participation is correlated with a greaterlevel of private enterprises’ contribution to TPA. This indicates that the mixed-ownershipreform is beneficial for prompting private enterprises to shoulder responsibilities forbuilding a society of common prosperity. As shown by the mechanism test, state capitalequity participation encourages private enterprises to contribute to TPA primarily byalleviating corporate financing constraints through the resource complementarity effect.In contrast, the check & balance effect of promoting corporate poverty alleviation bymitigating the principal-agent problem has not yet been significantly demonstrated.Regarding the poverty alleviation model, state capital equity participation prompts privateenterprises to contribute to TPA through industrial development, educational investment,and environmental protection, emphasizing a combination of providing external assistanceand cultivating endogenous development capacity. In terms of TPA regions, state capitalequity participation plays a significant role in supporting economically less-developedregions, regions with high unemployment rates, and central and western regions. This paperprovides new empirical evidence for deepening mixed-ownership reforms and advancingcommon prosperity.

Keywords: Mixed ownership, TPA, state capital, resource complementarity, check &

JEL Classification Codes: G32, G34, M14

DOI: 10.19602/j.chinaeconomist.2024.09.02