Recruiting and retaining leaders and public servants at the grass-roots level in developing countries creates a potential tension between providing sufficient returns to attract talent and limiting the scope for excessive rent-seeking behavior. In China, researchers have frequently argues that village cadres, who are the lowest level of administrators in rural areas, exploit personal political status for economic gain. Much existing research, however, compares the earning of cadre and non-cadre households in rural China without controlling for unobserved dimensions of ability that are also correlated with success as entrepreneurs or in non-agricultural activities. The findings of this paper suggest a measurable return to cadre status, but the magnitudes are not large and provide only a modest incentive to participate in village-level public administration. The paper does not find evidence that households of village cadres earn significant rents from having a family member who is a cadre. Given the increasing return to non-agricultural employment since China's economic reforms began, it is not surprising that the return to working as a village cadre has also increased over time. Returns to cadre status (such as they are) are derived both from direct compensation and subsidies for cadres and indirectly through returns earned in off-farm employment from businesses and economic activities managed by villages.

We examine whether and how political connections influence the use of courts in transitional and authoritarian settings using survey data of over 3,900 private firms in China. Although political connections are normally associated with “using the back door,” we find that politically connected firms are more inclined than unconnected firms to use courts over informal means of dispute resolution. Our finding raises a more challenging question: Are politically connected firms more likely to litigate because of their advantages in “know-how” (knowledge of navigating courts) or “know-who” (political influence over adjudication)? By manipulating regional institutional variance as moderators, we find evidence that political advantage dominates knowledge advantage in linking political connections to the use of courts, implying a relationship of perverse complementarity. This finding suggests that expansion of formal institutions may not necessarily erode informal networks; it is the latter that emboldens market actors to seize the advantage of the legal system.

China’s remarkable development poses a problem for theories that have stressed the importance of institutions producing “good governance” and minimizing corruption.  As a possible solution to this problem, the following ten arguments are presented:  1) Current research presents us with two very different concepts of governance; 2) Only one of these can serve as the basis for an operationalization of “good governance”; 3) In this approach, labeled “Quality of Government” (QoG), it is argued that QoG should be distinguished from “quality of democracy”, implying that; 4) the definition of QoG should be confined to the execution and implementation of public policies; 5) Using a “public goods” approach to corruption, QoG can be defined and measured in a universal way using impartiality in the exercise of public power as the basic operational norm; 6) As with representative democracy, QoG can be institutionalized in very different ways; 7) Most western scholars have confused countries’ specific institutional configuration of “good governance” with the basic norm for QoG which; 7) has led to dysfunctional policy suggestions for developing countries;  8) Beginning in the 1990, the public administration in China has used performance-based management as its main operational tool; 9) This specific type of public administration can be conceptualized as a cadre organization – a non-Weberian model for increasing QoG, that has been neglected both in public administration research and in the institutional theory of development; 10) The cadre organization model, which is also found in the West, solves the perennial delegation problem in public administration, which can explain why China has thrived, despite not having a Weberian rule-of-law type of administration and scoring relatively high on standard measures of corruption.

All the theories that explain post-Mao China’s economic success tend to attribute it to one or several “successful” policies or institutions of the Chinese government, or to account for the success from economic perspectives. This article argues that the success of the Chinese economy relies not just on the Chinese state’s economic policy but also on its social policies. Moreover, China’s economic success does not merely lie in the effectiveness of any single economic or social policy or institution, but also in the state’s capacity to make a policy shift when it faces the negative unintended consequences of its earlier policies. The Chinese state is compelled to make policy shifts quickly because performance constitutes the primary base of its legitimacy, and the Chinese state is able to make policy shifts because it enjoys a high level of autonomy inherited from China’s past. China’s economic development follows no fixed policies and relies on no stable institutions, and there is no Chinese model or “Beijing consensus” that can be constructed to explain its success.

This study examines the influence of voter heterogeneity, measured as religious fractionalization, on how the introduction of elections affects public goods in rural China. We document religious composition and the introduction of village-level elections for over two hundred villages and examine the interaction effect of average heterogeneity and the introduction of elections on village-government provision of public goods. We find that the increase in public goods due to elections declines with heterogeneity of villages, which we interpret as evidence that voter heterogeneity constrains the potential benefits of introducing elections.