Red Capitalists: Political Connections and the Growth and Survival of Start-Up Companies in China

descriptionPublicationkeyboard_double_arrow_right Article , Other literature type , Preprint 01 Jan 2007 English Publisher:Elsevier BVJournal:SSRN Electronic Journal (eissn: 1556-5068,

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Authors: Jun Du; Sourafel Girma;

doi: 10.2139/ssrn.1032948

Red Capitalists: Political Connections and the Growth and Survival of Start-Up Companies in China

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Abstract

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, even if politically neutral start-ups enjoy faster productivity improvements. In addition, the benefits of political connections are largely confined to firms associated with local or top level governments, and they are more pronounced in capital-intensive industries.

Related Organizations

University of Nottingham
United Kingdom
Aston University
United Kingdom

Keywords

China, political connections, growth, survival

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