Abstract
Using a unique firm level data, this paper analyses the role of political connections in the post-entry performance of private start-up companies in China. It documents robust evidence that political affiliation enhances firms’ survival and growth prospects. But interestingly politically neutral start-ups enjoy faster productivity improvements conditional on survival.. We conclude that the close association between the state and a segment of the business community is leading to sub-optimal resource allocation in the economy by interfering with the process of market selection.
| Original language | English |
|---|---|
| Publication status | Published - 2009 |
| Event | 36th annual conference of the European Association for Research in Industrial Economics - Ljubljana, Slovakia Duration: 3 Sept 2009 → 5 Sept 2009 |
Conference
| Conference | 36th annual conference of the European Association for Research in Industrial Economics |
|---|---|
| Abbreviated title | EARIE 2009 |
| Country/Territory | Slovakia |
| City | Ljubljana |
| Period | 3/09/09 → 5/09/09 |
Keywords
- firm growth
- survival
- political economy
- industry dynamics