Elite Cleavage and the Rise of Capitalism under Authoritarianism: A Tale of Two Provinces in China

Qi ZHANG, Dong ZHANG, Mingxing LIU, Victor SHIH

Research output: Journal PublicationsJournal Article (refereed)peer-review

Abstract

A great challenge for capitalist development under authoritarian regimes is to effectively constrain predatory behavior. Beyond existing frameworks of the dictator’s time horizon and institutionalized power sharing, we introduce an alternative perspective—elite cleavage. We argue that the systematic vulnerability of marginalized local cadres motivated them to ally with grassroots constituents and protect local economic interests in order to increase the odds of political survival. Difference-in-Differences (DID) analysis of counties in two Chinese provinces shows that the upheaval of the Cultural Revolution created a moment of political decentralization which enabled marginalized local elites to protect local entrepreneurs against national-level radical policies, resulting in much more vibrant private economic activities in some regions. Further empirical evidence shows that elite cleavages formed in the 1940s had a long-lasting impact on economic performance in the reform era.
Original languageEnglish
JournalJournal of Politics
DOIs
Publication statusAccepted/In press - 17 May 2020

Keywords

  • authoritarian politics
  • capitalism
  • China
  • Cultural Revolution

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