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Regional institutional development, political connections, and entrepreneurial performance in China’s transition economy

Lookup NU author(s): Dr Wubiao Zhou

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This work is licensed under a Creative Commons Attribution-NonCommercial 4.0 International License (CC BY-NC 4.0).

Abstract

While previous research emphasizes the role of political connections in facilitating entrepreneurial performance during China’s early reform period (1978–1999), this study argues that regional institutions were increasingly conducive to entrepreneurial activities and, thus, also played a key role in China’s entrepreneurial success during that period. The purpose of this study is twofold. First, it aims to demonstrate how regional institutional development facilitated entrepreneurial performance in China. Second, it aims to understand how formal institutional development among Chinese regions affected the role of political connections. Using a two-level hierarchical dataset on Chinese private enterprises, this study finds that not only legal protection of property rights but also the development of market systems mattered for entrepreneurial performance. In addition, it shows that political connections played a diminishing role during regional institutional development in China.

Publication metadata

Author(s): Zhou W

Publication type: Article

Publication status: Published

Journal: Small Business Economics

Year: 2014

Volume: 43

Issue: 1

Pages: 161-181

Print publication date: 01/06/2014

Online publication date: 07/12/2013

Acceptance date: 29/10/2013

Date deposited: 16/02/2017

ISSN (print): 0921-898X

ISSN (electronic): 1573-0913

Publisher: Springer

URL: http://dx.doi.org/10.1007/s11187-013-9527-3

DOI: 10.1007/s11187-013-9527-3

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