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Employee motivation, external orientation and technical efficiency of foreign-financed firms in China: a stochastic frontier analysis
journal contribution
posted on 2023-06-07, 04:46 authored by Vincent Mok, Godfrey YeungBy using a stochastic frontier model, we have identified several firm-specific attributes as determinants of technical efficiency in foreign-financed manufacturing firms in southern China. The empirical results suggest a strong association between efficiency and employee motivation, which includes the use of bonus incentives and flexibility in employment policy. In terms of the external orientation behavior of firms, the findings do not support the export/efficiency relationship. Sample firms with a high degree of export-orientedness were less efficient, possibly due to the high transaction costs in China of exportation. As for the effects of expatriate input on production, our empirical evidence revealed that firms with a relatively high expatriate ratio performed less efficiently than others did. These two findings may have significant implications for the marketing strategies and management (including the localization) of human resources of foreign-financed firms in China.
History
Publication status
- Published
Journal
Managerial and Decision EconomicsISSN
0143-6570Publisher
Wiley BlackwellExternal DOI
Issue
3Volume
26Page range
175-190Department affiliated with
- Sociology and Criminology Publications
Full text available
- Yes
Peer reviewed?
- Yes