Employee Stock Ownership Plan And Enterprise Total Factor Productivity

Nowadays,the main focus of China’s economic development has shifted from the speed of growth to the quality of growth,so it is necessary to change the previous "extensive" growth model and find a new driving force to promote sustainable economic development.The report of the 19th CPC National Congress emphasizes the importance of improving total factor productivity(TFP)for China’s economic development at the current growth model transformation stage.The improvement of enterprise TFP can translate the macro-economic goals to the micro level,improve the efficiency of internal resource allocation and production,and make the national economy enter a virtuous cycle.As the main participant and actual executor of enterprise production,employees are the important human resources of an enterprise.Their cohesion,enthusiasm and loyalty are the key to enhance the internal control quality and input-output efficiency.On June 20,2014,Employee Stock Ownership Plan(ESOP)was restarted in China and has been receiving extensive and positive responses from listed companies.Therefore,it is of great significance to further explore the relationship between ESOP and enterprise TFP.This paper investigates the impact of ESOP on enterprise TFP by using the data of Chinese A-share listed companies from 2011 to 2019,and uses propensity score matching method before regression analysis to mitigate the sample self-selection problem.The result shows that the implementation of ESOP can promote the improvement of enterprise TFP.Mechanism test shows that ESOP can improve enterprise TFP by improving the quality of internal control.Furthermore,it is found that the implementation of ESOP has a more significant impact on state-owned enterprises’ TFP and the ESOP has a more significant effect on the improvement of enterprise TFP when the fund source is the employee’s own capital.The study of this paper reveals the relationship between ESOP and enterprise TFP,verifies the mediating role of internal control quality in the promotion of enterprise TFP by ESOP,enriches and expands the research on the influential factors affecting enterprise TFP with employees as the main body,and has certain guiding significance for the improvement of related policies of ESOP by the state and the optimization of specific implementation plans of ESOP by enterprises.