 How does the Chinese communist party embrace the private sector?Kun Jiang, Frank M. Song and Peng Zhou Journal of Comparative Economics, 2026, vol. 54, issue 1, 229-247 Abstract: The expansion of private firms presents new dynamics for the leadership of the Chinese Communist Party (CCP) in the private sector. Utilizing data from 17,681 private firms spanning from 2006 to 2016, this study examines how the CCP reinforces its presence in the private sector by the extension of grassroots party branches into private firms. Our findings suggest that private firms with in-house party branches receive considerable financial support without facing increased government expropriation, which enhances the appeal of such branches to entrepreneurs. Furthermore, the presence of party branches has a greater impact in regions where the private sector plays a larger role and entrepreneurship is flourishing. We also find that in-house party branches tend to steer private firms to investments that generate higher social returns, potentially diverting resources away from their ongoing business activities. Such resource reallocation enhances the performance of private firms facing financing constraints. Keywords: Private sector; Party branch; Organizational structure extension; Bank loan (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:eee:jcecon:v:54:y:2026:i:1:p:229-247 DOI: 10.1016/j.jce.2025.10.002 Access Statistics for this article Journal of Comparative Economics is currently edited by D. Berkowitz and G. Roland More articles in Journal of Comparative Economics from Elsevier |
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