Re-examining economic returns to Communist Party membership in Mainland China

Qian Guo and Wenkai Sun

Journal of the Asia Pacific Economy, 2019, vol. 24, issue 1, 24-41

Abstract: This article examines economic returns to Communist Party membership and its possible effects on other human capital, for college graduates in Mainland China. Different analytical methods return highly comparable results that suggest party membership has no direct effect on starting salaries of college graduates. However, party membership improves college graduates’ possibility of being admitted to Chinese universities for advanced studies and that of obtaining permanent urban residence (hukou). The latter possibly results from party members’ enhanced chances of entering state-owned enterprises. Party membership does not crowd out other human capital investments; on the contrary, it seems to have positive effects on technical certificate earning, student leadership experience, and GPA rankings and thus may impact salaries indirectly. This study is a meaningful addition to existing literature: it shows that party membership, though exerting no direct effect on salaries, may bring indirect and hidden returns. This conclusion is consistent with what may be observed in reality.

Date: 2019
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DOI: 10.1080/13547860.2018.1490069

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