The Clan and the Corporation: Sustaining Cooperation in China and Europe
74 Pages Posted: 16 Feb 2015 Last revised: 30 Apr 2017
Date Written: January 1, 2017
Over the last millennium, the clan and the corporation have been the loci of cooperation in China and Europe respectively. This paper examines -- analytically and historically -- the cultural and institutional co-evolution that led to this bifurcation. We highlight that groups with which individuals identify are basic units of cooperation. Such loyalty groups influence institutional development because intra-group moral commitment reduces enforcement cost implying a comparative advantage in pursuing collective actions. Loyalty groups perpetuate due to positive feedbacks between morality, institutions, and the implied pattern of cooperation.
Keywords: Institutions, Culture, Cooperation, China, Europe, Clans, Corporation, Social organization
Suggested Citation: Suggested Citation