Sang Yun Lee

Job market paper

Government’s sequential selection for state-owned enterprises in case of equitization in Vietnam

This paper examines the Vietnamese government's systematic approach to equitizing state-owned enterprises (SOEs) from 2002 to 2017. Equitization refers to the partial privatization of SOEs in Vietnam. It examines how the government selected and prioritized SOEs for equitization, focusing on the motivations behind its equitization choice and the changes in government equitization priorities over time. Using a discrete choice model and estimating it with an unordered Multinomial Probit model on a firm-level panel dataset from the Vietnam General Statistics Office, this study reveals that the government has persistently preferred to equitize SOEs that, for example, are in nonprimary sectors and small-/medium-sized. However, this paper finds no evidence that past firm profitability influenced the government's decision to equitize, contrasting with the findings of previous privatization literature. The analysis also challenges the assumption of unchanging equitization priorities of the government, offering new insights into Vietnam's equitization strategy for other emerging economies.