The Prevalence and the Increasing Significance ofGuanxi

Abstract

AbstractThis paper provides an analytical review of the social science literature onguanxi. The focus of this review is on the prevalence and the increasing significance ofguanxiduring China's post-1978 reforms, which were implemented to move the country towards a market economy. Since then, researchers have engaged in debates on whatguanxiactually means to Chinese people in the past and today, how it has been adaptive to ongoing institutional transformations, and why its influence in economic, social, and political spheres can stabilize, increase or decrease with market reforms and economic growth. The author provides a synthesis of these debates before offering a theoretical framework which provides an understanding of the dynamics ofguanxithrough the changing degrees of institutional uncertainty and market competition. Survey findings on the increasing use ofguanxiin labour markets from 1978 to 2009 are presented to illustrate the usefulness of this framework. In the conclusion, the author argues thatguanxiis a five-level variable, and that the nature and forms ofguanxiinfluence are contingent upon whetherguanxiis a tie of connectivity, a sentimental tie, a sentiment-derived instrumental tie, an instrumental-particular tie, or an obligational tie that facilitates power and money exchanges. This five-level conceptualization is aimed at advancing future scholarship ofguanxiin China's rapidly changing society.