Bargaining Success of Chinese Factories

China Quarterly, No. 132, pp. 1086-1100, December 1992

15 Pages Posted: 18 Apr 2008

See all articles by Kevin J. O'Brien

Kevin J. O'Brien

University of California, Berkeley - Charles and Louise Travers Department of Political Science

Abstract

Based on interviews and a questionnaire administered to 25 factory directors in November 1988, this study investigates factors that determine the bargaining power of large and medium-sized Chinese factories. It shows that directors of larger, higher-ranking factories are more successful in preserving autonomy and gaining concessions and exemptions from their supervisory agencies on salary and bonus pools and distribution, on tax rates, and on personnel decisions. It relates the Chinese experience to discussions of "soft budget constraints" in socialist Hungary and shows that many politically significant directors wish to maintain protected, dependent relationships with their supervisors and are hesitant to support radical ownership reforms that would decisively increase autonomy and might enhance efficiency.

Keywords: China, factories, soft budget constraint, Hungary, state-owned enterprises

JEL Classification: D23, D74, L20, O54, P22, P27, P32, P59

Suggested Citation

O'Brien, Kevin J., Bargaining Success of Chinese Factories. China Quarterly, No. 132, pp. 1086-1100, December 1992. Available at SSRN: https://ssrn.com/abstract=1121886

Kevin J. O'Brien (Contact Author)

University of California, Berkeley - Charles and Louise Travers Department of Political Science ( email )

210 Barrows Hall
Berkeley, CA 94720
United States

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