Informal Institutions and Authoritarian Information Systems: Theory and Evidence from China

46 Pages Posted: 26 Jun 2017

See all articles by Junyan Jiang

Junyan Jiang

Columbia University

Jeremy Wallace

Cornell University - Department of Government

Date Written: June 25, 2017

Abstract

Authoritarian regimes face pervasive information problems, not only between state and society but also inside of their own hierarchies. How do authoritarian leaders address internal information issues? We argue that authoritarian information systems contain both formal and informal channels and show substitution between them using evidence from China’s economic reporting system. We construct a new measure for economic falsification by subtracting a “plausible growth rate” generated by the Random Forests technique from the official GDP growth rate for each of China’s cities. We find that growth over-reporting is less severe in cities where higher-level political leaders enjoy strong informal networks that can serve as alternative information channels. This result is robust across different falsification measures and various alternative specifications. We also explore heterogeneity and spillovers associated with this distortion-reduction effect. Our findings underscore the importance of informal institutions and contribute to a more comprehensive understanding of authoritarian information systems.

Keywords: information, informal institution, statistical falsification, authoritarian regime, China

Suggested Citation

Jiang, Junyan and Wallace, Jeremy, Informal Institutions and Authoritarian Information Systems: Theory and Evidence from China (June 25, 2017). Available at SSRN: https://ssrn.com/abstract=2992165 or http://dx.doi.org/10.2139/ssrn.2992165

Junyan Jiang (Contact Author)

Columbia University ( email )

7th Floor, International Affairs Bldg.
420 W. 118th Street
New York, NY 10027
United States

Jeremy Wallace

Cornell University - Department of Government ( email )

Ithaca, NY 14853
United States

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