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Economic Returns to Communist Party Membership: Evidence From Urban Chinese Twins

Hongbin Li (), PakWai Liu, Junsen Zhang and Ning Ma

Economic Journal, 2007, vol. 117, issue 523, 1504-1520

Abstract: This article estimates the returns to membership of the Chinese Communist Party using unique twins data we collected from China. Our OLS estimate shows a Party premium of 10%, but the within-twin-pair estimate becomes zero. One interpretation is that the OLS premium is due to omitted ability and family background. This interpretation suggests that Party members fare well not because of their political status but because of the superior ability that made them Party members. The estimates are also consistent with another interpretation that Party membership not only has its own effect but also has an external effect on siblings. Copyright 2007 The Author(s). Journal compilation Royal Economic Society 2007.

Date: 2007
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