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Guanxi Networks in China: Its Importance and Future Trends

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  • Jin Ai

Abstract

China's market potential is unparalleled, although many foreign business practitioners have commented that operating profitably in China is difficult, and more complex and time consuming than should be necessary. Given these facts, a lot of research on doing business in China gives recognition to the concept of Guanxi, a social and business relationship network, as the key to conducting successful business. By analyzing current research and collecting primary data from both the Chinese Mainland and Taiwan Province, this study aims to clarify the importance of Guanxi, and to study the future trend of Guanxi. By doing so, this paper intends to help business practitioners in China, especially those from the Western countries, to gain a deeper and more practical insight into the Chinese social network, and to help them make effective cross‐cultural adaptation and business decisions in the unfamiliar cultural environment of China. (Edited by Xiaoming Feng)

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  • Jin Ai, 2006. "Guanxi Networks in China: Its Importance and Future Trends," China & World Economy, Institute of World Economics and Politics, Chinese Academy of Social Sciences, vol. 14(5), pages 105-118, September.
    • Handle: RePEc:bla:chinae:v:14:y:2006:i:5:p:105-118
    DOI: 10.1111/j.1749-124X.2006.00034.x
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    Cited by:

    1. Karoliina Isoaho & Alexandra Goritz & Nicolai Schulz, 2016. "Governing clean energy transitions in China and India: A comparative political economy analysis," WIDER Working Paper Series 028, World Institute for Development Economic Research (UNU-WIDER).
    2. Susanne Rühle, 2011. "A Different Capitalism for China? The Role of Guanxi and the Family for Chinese Economic Development," Chapters, in: Werner Pascha & Cornelia Storz & Markus Taube (ed.), Institutional Variety in East Asia, chapter 8, Edward Elgar Publishing.
    3. Wang, Ning & Zhang, Chunyan, 2024. "The greed factor of executives and the risk of a company stock price crash," Finance Research Letters, Elsevier, vol. 62(PA).
    4. Pattarin Adithipyangkul & Ilan Alon & Tianyu Zhang, 2011. "Executive perks: Compensation and corporate performance in China," Asia Pacific Journal of Management, Springer, vol. 28(2), pages 401-425, June.
    5. Hu, Juncheng & Li, Xiaorong & Duncan, Keith & Xu, Jia, 2020. "Corporate relationship spending and stock price crash risk: Evidence from China's anti-corruption campaign," Journal of Banking & Finance, Elsevier, vol. 113(C).
    6. Russell Fralich & Hong Fan, 2018. "Legislative political connections and CEO compensation in China," Asian Business & Management, Palgrave Macmillan, vol. 17(2), pages 112-139, April.
    7. Yi Liu & Cecil Pearson, 2011. "The Determining Factors of Western Australia’s (WA) Foreign Investment in China," Global Business Review, International Management Institute, vol. 12(1), pages 1-20, February.
    8. Justin Joseph & Joe Thomas Karackattu, 2022. "State actions and the environment: examining the concept of ecological security in China," Environment, Development and Sustainability: A Multidisciplinary Approach to the Theory and Practice of Sustainable Development, Springer, vol. 24(11), pages 13057-13082, November.
    9. Cheng, Louis T.W. & Chan, Ricky Y.K. & Leung, T.Y., 2018. "Impact of perk expenditures and marketing expenditures on corporate performance in China: The moderating role of political connections," Journal of Business Research, Elsevier, vol. 86(C), pages 83-95.
    10. Wei-Bin Zhang, 2021. "Economic Growth And Human Networking," Business & Management Compass, University of Economics Varna, issue 1, pages 5-25.
    11. Cho, Kang Rae & Huang, Chia-Hsing & Padmanabhan, Prasad, 2014. "Foreign ownership mode, executive compensation structure, and corporate governance: Has the literature missed an important link? Evidence from Taiwanese firms," International Business Review, Elsevier, vol. 23(2), pages 371-380.
    12. Karoliina Isoaho & Alexandra Goritz & Nicolai Schulz, 2016. "Governing clean energy transitions in China and India: A comparative political economy analysis," WIDER Working Paper Series wp-2016-28, World Institute for Development Economic Research (UNU-WIDER).
    13. Tebogo Rahaba Ngoma, 2016. "It is not whom you know, it is how well you know them: Foreign entrepreneurs building close guanxi relationships [Es geht nicht darum, wen du kennst, sondern wie gut du sie kennst: Wie ausländische," Journal of International Entrepreneurship, Springer, vol. 14(2), pages 239-258, June.

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