A Privilege of the Rich? A Duality of Unequal Government Responsiveness in Urban China

71 Pages Posted: 8 Nov 2022 Last revised: 28 Nov 2022

See all articles by Jiawei Fu

Jiawei Fu

New York University (NYU) - New York University

Zeren Li

Yale University

Haibing Yan

East China University of Political Science and Law

Date Written: November 14, 2022

Abstract

Does wealth inequality affect government responsiveness in authoritarian countries with no meaningful representation through which the affluent can influence politics? We address this question by unveiling the implicit privilege of the rich. We first develop a formal model to show how credible signals from the rich and misaligned interests in governments lead to the duality of unequal responsiveness: Although bureaucrats effectively respond to petitions from the poor, they place priority on the petitions by the rich. We empirically document this duality by matching unique data on municipal service records and apartment-complex-level housing prices in downtown Shanghai. Using 2SLS estimation and spatial RD design that explores the historical boundary of the foreign settlement, we show that the local government prioritizes petitions by residents living in more expensive areas. Consistent with the theory, we show no discrimination against the poor in petition resolution. This study highlights the unequal responsiveness in authoritarian regimes.

Keywords: Government Responsiveness, Bureaucracy, Duality, Housing Price, Authoritarianism, China

Suggested Citation

Fu, Jiawei and Li, Zeren and Yan, Haibing, A Privilege of the Rich? A Duality of Unequal Government Responsiveness in Urban China (November 14, 2022). Available at SSRN: https://ssrn.com/abstract=4253200 or http://dx.doi.org/10.2139/ssrn.4253200

Jiawei Fu

New York University (NYU) - New York University

Bobst Library, E-resource Acquisitions
20 Cooper Square 3rd Floor
New York, NY 10003-711
United States

Zeren Li (Contact Author)

Yale University ( email )

New Haven, CT 06510
United States

Haibing Yan

East China University of Political Science and Law ( email )

Shanghai
China

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