This descriptive study is based on a nationwide survey of
privatization in China. Between 1995 and 2005, close to
100,000 firms with 11.4 trillion RMB in assets were privatized
in China. This privatization process encompassed two-thirds of
state-owned enterprises and state assets. Privatization in China
has created concentrated private ownership and greatly changed
corporate governance. After privatization, the state has
withdrawn from firms’ daily decision making. Soft budget
constraints have been substantially hardened. Firms have
become more efficient and more profitable.postprin
