No.035, Nov./Dec., 2003

Social Connections in China: Institutions, Culture, and the Changing Nature of Guanxi.
Edited by Thomas Gold, Doug Guthrie and David Wank. New York, N.Y.: Cambridge University Press, 2002. 277 pp.

In Chinese

"Guanxi" (which means connections) has entered the English language and if you do a search on the Internet, you will receive hundreds of references. It is probably the most used word for people trying to understand how societies in mainland China, in Taiwan, Hong Kong and Singapore work. As a matter of fact, wherever there is a Chinese community, guanxi is an inescapable word when you want to do business. It would not be a surprise if one-day guanxi were entered into the English dictionary. The authors of this book have mostly agreed that it is a phenomenon in itself and in relations to all aspects in Chinese society around the world. But in China, guanxi works from the top leadership in politics to the lowest level in a village. This is where sociologists usually begin their research.

"Conventional wisdom among Chinese and foreigners holds that in the People's Republic of China, guanxi is absolutely essential to successfully complete any task in virtually all spheres of social life," the authors say in introducing the book, which is a fair warning considering societies in the Western world also function through personal connections or networking, but in China guanxi has become a science.

One aspect of guanxi is in the form of patron-client relations, which many authors say is in response to a situation in which powerful officials have control over access to jobs, housings and promotion. This example could illustrate the magnitude and impact of guanxi in politics where the older leaders hold the key to the future of younger generations seeking advance in the ladder of political power. Whether it has anything to do with culture and history, guanxi is an ongoing debate as scholars have tried to understand the phenomenon and by the same token also raise more questions about it.

"Many of these studies have demonstrated how Chinese people have used guanxi to cope with the lack of the rule of law and the arbitrary and discretionary nature of the use of power," the book says. Even without reference to guanxi, the authors say that the elite, factions and interest groups have used their personal networks based on common birthplaces, military services, and places of education or university as a way to seek protection, career advancement and jobs. This situation is seen strongly during the difficult years of the Cultural Revolution when many traditional institutions in society have collapsed, leaving individuals in search of the best way to survive. That way is the ties they have through connections.

Lisa A. Keister, a professor of sociology at the Ohio State University, explains the role guanxi plays in organizing social and economic interactions in China. That role is examined in the way the system of lending and trade relations works and in the way buyers and sellers do their business. She says the communist authorities launch the economic reform by rebuilding the lending and trade relations among firms that are doing business. She says that guanxi is found to have influenced the decision-making process among the firms that are carrying out the lending and trade relations. She says business managers cultivate social relations in order to build social indebtedness and gain advantage over lending and trade.

"In China, economic actors are often characterized as not simply recognizing and using social relations to their benefit in economic exchange, but researchers and practitioners alike quite often portray the Chinese as deliberately and strategically manufacturing social relations for the purpose of economic gain," Keister says. She cites studies by other authors who believe that family ties, ties with close friends and even weak ties with relatives are also considered guanxi. Those authors also think that guanxi is used whenever there is uncertainty in the business environment or in regulations, or to overcome the impact of Western ways of doing business through signed contracts.

Pitman B. Potter, a law professor who is specialized on law and legal culture in China and Taiwan and who is the director of the Institute of Asian research at the University of British Columbia, says in his study of guanxi and the Chinese legal system that China's socialist legal system and the traditional Chinese practice of guanxi complement rather than conflict with each other.

"Thus the complementary relationship between guanxi and law will continue to characterize the Chinese legal system for the foreseeable future," Potter says.

While trying to analyze guanxi, the authors have taken the readers and the curious to different levels of society to show how it works and is structured.


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