Friends with Benefits: How Political Connections Help to Sustain Private Enterprise Growth in China
James Kung () and
Economica, 2018, vol. 85, issue 337, 41-74
By analysing data from a survey of 511 Chinese private enterprises, we find that their owners respond to government discrimination by developing political connections with government officials. A one‐standard‐deviation increase in the insecurity of property rights has the effect of increasing the number of ‘friends’ in the government by a substantial 22%. These ‘friends’ significantly help to mitigate by half the negative effect arising from the difficulties of obtaining land and excessive regulations on enterprise growth. This explains why an institutional environment of weak property rights has not stopped private enterprises in China from developing rapidly.
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (5) Track citations by RSS feed
Downloads: (external link)
This item may be available elsewhere in EconPapers: Search for items with the same title.
Export reference: BibTeX
RIS (EndNote, ProCite, RefMan)
Persistent link: https://EconPapers.repec.org/RePEc:bla:econom:v:85:y:2018:i:337:p:41-74
Ordering information: This journal article can be ordered from
http://www.blackwell ... bs.asp?ref=0013-0427
Access Statistics for this article
Economica is currently edited by Frank Cowell, Tore Ellingsen and Alan Manning
More articles in Economica from London School of Economics and Political Science Contact information at EDIRC.
Bibliographic data for series maintained by Wiley Content Delivery ().