Pay Systems in Chinese State-Owned Enterprises: A Review

Directory : Faculty : Intellectual Contributions

Chinese Management Studies

L. Wang, J. Zhu

2009

Abstract

Purpose _ The purpose of this paper is to provide a comprehensive review and critique of what we

already know about pay systems in Chinese state-owned enterprises, to identify the gaps in the

literature and to stimulate more research in this area.

Design/methodology/approach _ The paper first describes the policy issues at the macro-level

(government policies) in order to put micro-level pay practices in a pertinent context. Then the paper

provides a detailed review and critique on current empirical studies on pay practices in Chinese

enterprises, their antecedents and consequences. Finally, the paper identifies potential research

questions and provides some directions for future research.

Findings _ The paper concludes from the extensive review of the current literature that the following

research areas merit attention: Why do some firms pay their employees more than other firms? Why

do we observe different types of internal pay structures among firms? What are the consequences of

these different structures? Why is the link between pay and performance weak in some firms but

strong in others? Under what conditions pay-for-performance enhances firm performance?

Originality/value _ The paper is one of the most comprehensive reviews of the literature on

compensation practices of Chinese companies.

Keywords Compensation, Pay structures, China, Public ownership, Human resource management

Paper type Literature review

Wang, L., Nicholson, J., Zhu, J. (2009). Pay Systems in Chinese State-Owned Enterprises: A Review. Chinese Management Studies, 3(4), 328-355.