- Title
- History and the path dependent nature of economic development: and the case of guanxi
- Creator
- Drew, Antony J.; Kriz, Anton P.
- Relation
- XXth Conference of the CEDIMES: Development Models of Emerging Countries: Characteristics, Scope and Challenges. Proceedings of the XXth Conference of the CEDIMES: Development Models of Emerging Countries: Characteristics, Scope and Challenges (Quebec City, Canada 8-10 November, 2010)
- Publisher
- Centre d'Etudes sur le Développement International et les Mouvements Economiques et Sociaux (CEDIMES)
- Resource Type
- conference paper
- Date
- 2010
- Description
- Purpose of research: History illustrates that different polities have adopted different socio-economic and socio-political development models in order to achieve modernity. More specifically, in the case of successful socio-economic and socio-political development, the models adopted have conformed to the paradigms held by the majority of the citizenry, to their cultural values and to the informal institutions that underpin the sense making of the citizens of the emerging country. By way of example, the underpinning of the economic development of the United States of America by the Protestant Ethic exemplifies the congruence between these factors, whilst the failed economic development of the former Soviet Union, drawing on Marxist-Leninist thought, is an example of incongruence between these factors. The history and the path dependent nature of the socio-political and socio-economic development of individual emerging countries suggest that one must first explore and trace the evolution of its antecedents; its cultural values and its evolving informal institutions and paradigms, in order to identify the types of characteristics that may or may not be part of its development model. This paper develops a theoretical framework order to better appreciate the potential trajectory of the economic development in emerging countries. The framework draws on Trivers' theory of Reciprocal Altruism from Evolutionary Biology, Berry's Ecocultural framework from Cross-cultural Psychology and North's framework for analysing economic and institutional change from New Institutional Economics. The framework is used to guide an exploratory examination into how the development models adopted in seven Asian polities might influence the reliance by Chinese businesspeople on guanxi (relationships) to manage opportunism, reduce search and transaction costs, and reduce environmental uncertainty. Method: The empirical study adopts a qualitative research methodology which comprises nine focus group interviews, conducted in eight cities with 45 business people of Chinese ethnic origins, and an online survey based on the focus group interview protocol. The online survey yielded 121 usable data sets. The survey instrument contained 11 demographic questions to categorise respondents into clusters; 19 open ended questions posed in Chinese characters to explore any regional variations in the perceptions of guanxi related constructs and; 21 open ended questions to explore regional variations in perceptions of guanxi practice due to external forces. The data from both the focus group interviews and online survey were content analysed using NVivo8. Principle Results: Adopting the theoretical framework has enabled a richer analysis of the characteristics and impacts of seven development models on the use of guanxi by Chinese business people. The findings indicate that the nature and practice of guanxi varies from polity to polity, dependent on the type of development models adopted. Guanxi is ceding to more formal business, political and legal institutions in the developed polities of Hong Kong, Taipei, Singapore and Macau, however it still strongly relied upon in Indonesia, Malaysia and to a lesser extent, in Mainland China. Interestingly, responses from all locations investigated indicate that the nature and practice of guanxi is still very malleable and that despite the presence of more formal Western style politico-legal and politico-economic institutions, most respondents agreed that they would still use guanxi as a source of competitive advantage and particularly in times of scarce resources.
- Subject
- guanxi; institutions; reciprocal altruism; ecocultural framework; cross-cultural psychology
- Identifier
- http://hdl.handle.net/1959.13/935041
- Identifier
- uon:11950
- Language
- eng
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