Heather A. Haveman
Professor, Department of Sociology
Ph.D. University of California, Berkeley
Economic transition in China; organizational theory; economic sociology; historical sociology; entrepreneurship; organizational demography; gender, careers, and social mobility
Chinese listed firms. With Yongxiang Wang and Nan Jia at USC and Jing Shi at Australian National University, I am studying the continuing economic transition in China. In the wake of this transition, there has been much debate about how ties between political and economic actors, in particular between state bureaucrats and business firms, changed. In our paper, we argue that given the lack of political reform, the value of politician connections for business strengthened. Economic reform created many new business opportunities; in the absence of political reform, political connections became more important for acquiring state-controlled resources and for gaining state authorization of business activities that allowed firms to take advantage of these opportunities. Our analysis of Chinese listed firms from 1992 to 2007 supports this argument: as market development progressed, firmsí political connections had increasingly positive effects on overall performance and access to bank loans. These effects were more pronounced in more-competitive markets because there was more at stake there. These effects were less pronounced for larger firms because they benefited from economies of scale and so were better-positioned to handle increased competition; they also had easier access to state-controlled resources and lower risks of state expropriation of their assets. Overall, our result reveals that economic reform without political reform has made political actors in China increasingly powerful economic actors.