Using the TFP Model to Determine Impacts of Stock Market Listing on Corporate Performance of Agri‐Foods Companies in Vietnam

AuthorDinh Thi Bao Linh,Junaid M. Shaikh
Date01 March 2017
Published date01 March 2017
© 2017 Wiley Periodicals, Inc.
Published online in Wiley Online Library (
DOI 10.1002/jcaf.22259
Using the TFP Model to
Determine Impacts of Stock
Market Listing on Corporate Performance
of Agri-Foods Companies in Vietnam
Junaid M. Shaikh and Dinh Thi Bao Linh
Topic Statement
The Vietnam
economy is one of
the special economic
models in the world.
It is a “socialist-
oriented market
economy.” The coun-
try is now one of
the world’s leading
exporters of agricul-
tural products. Even
during the recent
economic crisis in
Asia and throughout
the world, the Viet-
namese economy has
seen a higher growth
rate than the regional
average level. With
many companies
in operation, the
agricultural sector
is the unique sector
maintaining a trade
surplus (in Vietnam,
only companies can
export). How can
these companies help
Vietnam to be a key
global exporter of
agricultural products
such as pepper, rice,
cashew nuts, coffee,
and catfish? Lessons
have been learned
from observing
events taking place
within the more
matured and other
developing countries.
One of the hot
topics being dis-
cussed is the role of
the private securi-
tized sector, which
is new in Vietnam
in contrast to the
traditional social-
ist point of view.
As Vietnam is now
a member of more
than 10 bilateral and
Being one of the world’s leading exporters of different
agricultural products, especially rice, pepper, and catfish,
Vietnam has a significant role to play in the agricultural-
related, economic, and geographic political issues of Asia.
The transformation from a socialist public-owned economy to
a private-equity form of ownership through the securitization
of resources will have a significant impact on the economic
well-being of Vietnam. Since the recent advances of China
and its ambition in the South China Sea, big countries like
the United States, Japan, and India have considered Vietnam
a key partner in their new Asia strategies. Along with the eco-
nomic integration and trade liberalization, Vietnam is opening
its market with 100 million consumers and also many export
opportunities to international business and investors. Is the
stock market a transparent and efficient channel for their
choice? That depends not only on the legal framework, but
also on the performance of Vietnamese companies that may
become their partners or rivals.
This article investigates the effect of stock market listing on
the corporate performance of listed food processing and agri-
cultural companies in Vietnam. Using the regression analysis
and a total factor productivity (TFP) model modified to fit the
Vietnam data, the study revealed that stock listing has a posi-
tive effect on corporate performance in Vietnam. Key findings
lead to the recommendation that the Vietnamese government
should enhance the process of privatizing state-owned enter-
prises (SOEs) and stock market listing in the foods and agri-
cultural sectors, focusing on market transparency and fairness,
securities market reform, and incentives policies dealing with
credit, tax, and land ownership. © 2017 Wiley Periodicals, Inc.
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