The impact of foreign ownership and off-shore investing on technical efficiency: evidence from Chinese managed funds industry
In a landmark reform in the managed fund industry, China permitted foreign joint ventures as well as off-shore investing. Have these decisions helped improved the efficiency of the industry? We examine this hitherto unexamined question in the literature, using a robust method of efficiency analysis—...
| Main Authors: | , |
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| Format: | Journal Article |
| Published: |
2016
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| Online Access: | http://hdl.handle.net/20.500.11937/14541 |
| _version_ | 1848748650445930496 |
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| author | Liu, Li Xian Sathye, M. |
| author_facet | Liu, Li Xian Sathye, M. |
| author_sort | Liu, Li Xian |
| building | Curtin Institutional Repository |
| collection | Online Access |
| description | In a landmark reform in the managed fund industry, China permitted foreign joint ventures as well as off-shore investing. Have these decisions helped improved the efficiency of the industry? We examine this hitherto unexamined question in the literature, using a robust method of efficiency analysis—bootstrap data envelopment analysis. We compute the bootstrap efficiency scores and regress them using truncated regression on environmental variables. We focus on 64 of 69 funds management companies in China from 2003 to 2011 using a unique dataset made available to us. We find that there is considerable room for funds management companies to improve technical efficiency to ultimately bring increased benefits to investors. We find that foreign ownership has not helped efficiency improvement. Similarly, off-shore investing had no impact on technical efficiency. A number of regulatory constraints still persist in China, which makes it hard for the previously measured to yield efficiency gains. We recommend further liberalization of the sector, for example, by removing restriction on distribution of foreign funds. |
| first_indexed | 2025-11-14T07:08:25Z |
| format | Journal Article |
| id | curtin-20.500.11937-14541 |
| institution | Curtin University Malaysia |
| institution_category | Local University |
| last_indexed | 2025-11-14T07:08:25Z |
| publishDate | 2016 |
| recordtype | eprints |
| repository_type | Digital Repository |
| spelling | curtin-20.500.11937-145412017-09-13T14:05:39Z The impact of foreign ownership and off-shore investing on technical efficiency: evidence from Chinese managed funds industry Liu, Li Xian Sathye, M. In a landmark reform in the managed fund industry, China permitted foreign joint ventures as well as off-shore investing. Have these decisions helped improved the efficiency of the industry? We examine this hitherto unexamined question in the literature, using a robust method of efficiency analysis—bootstrap data envelopment analysis. We compute the bootstrap efficiency scores and regress them using truncated regression on environmental variables. We focus on 64 of 69 funds management companies in China from 2003 to 2011 using a unique dataset made available to us. We find that there is considerable room for funds management companies to improve technical efficiency to ultimately bring increased benefits to investors. We find that foreign ownership has not helped efficiency improvement. Similarly, off-shore investing had no impact on technical efficiency. A number of regulatory constraints still persist in China, which makes it hard for the previously measured to yield efficiency gains. We recommend further liberalization of the sector, for example, by removing restriction on distribution of foreign funds. 2016 Journal Article http://hdl.handle.net/20.500.11937/14541 10.3905/jwm.2016.18.4.138 restricted |
| spellingShingle | Liu, Li Xian Sathye, M. The impact of foreign ownership and off-shore investing on technical efficiency: evidence from Chinese managed funds industry |
| title | The impact of foreign ownership and off-shore investing on technical efficiency: evidence from Chinese managed funds industry |
| title_full | The impact of foreign ownership and off-shore investing on technical efficiency: evidence from Chinese managed funds industry |
| title_fullStr | The impact of foreign ownership and off-shore investing on technical efficiency: evidence from Chinese managed funds industry |
| title_full_unstemmed | The impact of foreign ownership and off-shore investing on technical efficiency: evidence from Chinese managed funds industry |
| title_short | The impact of foreign ownership and off-shore investing on technical efficiency: evidence from Chinese managed funds industry |
| title_sort | impact of foreign ownership and off-shore investing on technical efficiency: evidence from chinese managed funds industry |
| url | http://hdl.handle.net/20.500.11937/14541 |