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«Inaugural-Dissertation zur Erlangung des Doktorgrades des Fachbereichs Wirtschaftswissenschaften der Johann-Wolfgang Goethe-Universität Frankfurt am ...»

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In the 1980s, the concept of a ‗Confucian Capitalism‘ was developed. It claimed that traditional family and kinship ties are more an asset than an obstacle to development due to the ―Confucian familistic culture‖ of China.562 The invention of this ‗Capitalism with Chinese characteristics‘ coincided with a "post-revolutionary discourse on Capitalism" and with the retreat of socialism.563 'Chinese' characteristics were rearranged with the intention to create a new model and "a new reality of development" to explain the economic dynamics of East Asia out of long existing stereotypes.564 Interestingly, the concept was coined by US researchers in the wake of exceptional Asian growth and the simultaneous decline of Euro-American economies, only later taken on by native Chinese researchers.565 This research drew an analogy to Weber's ‗spirit of Capitalism‘, reversing his impression of the potential of Confucianism. As a consequence, it also implied that only one ‗modernity‘ can exist with a timeless and ahistorical identity as a yardstick against which the degree of backwardness of a society will be measured. Confucianism got ―Weberized‖ in its revival, because it was claimed that it shares similar values to those Weber ascribed to the Protestant ethic, such as a collectivist ethic, predilection for hard work, and respect for education.566 Thus, if there is something like ‗Chineseness‘ in doing business and creating a specific sort of Capitalism, people will be careful not to associate anything traditional, feudal, and hence backward with it. The use of Confucianism as an explanation of a unique way to do business was a loophole out of this dilemma and for that reason was fostered as a concept by Chinese researchers and politicians.567 One reason to explain this artificial concept is that the Confucian renaissance substituted socialism in providing norms for social behavior and guaranteeing social order because it merely constitutes the reinforcing of an already existing value system. This contradicts actual historical facts: Although it is true that Confucianism has a long tradition in Chinese society, it was forgotten, and during socialism, especially during the Cultural Revolution568, even forbidden. In the course of explaining China‘s economic success, ConGreenhalgh, 1994, p. 746.

Dirlik, 1997, p. 304.

Dirlik, 1997, p. 304.

Dirlik, 1997, p. 305.

Greenhalgh, 1994, p. 746 and Dirlik, 1997, p. 313.

Greenhalgh, 1994, p. 768f. It is a difficult task to define precisely the concept of China or ‗Chineseness‘.

However, within this dissertation, Chinese Capitalism refers to ‗inside China‘, not to Chinese communities outside mainland China. Additionally, I do not want to imply that a ‗global‘ Chineseness exists that ignores national, regional and even local differences. It is also noteworthy that Chinese Capitalism is not identical with a maybe existing Asian Capitalism.

The Cultural Revolution was launched by Chinese Communist Party chairman Mao Zedong during his last decade in power (1966-76) officially as a campaign to rid China of its ‗liberal bourgeoisie‘ elements and to renew the spirit of the Chinese revolution. Fearing that China would develop along the lines of the Soviet fucianism seemed as a logic explanation of an otherwise curious development. Also, Chinese people thankfully took up rationalization, Confucianism getting ‗en vogue‘.569 Thus, Confucian values such as strong family structures, commitment to education, kinship and pseudo-kinship social networks, but also diligence, thrift and business orientation are not ―essential exclusive, unchanging Chinese values‖ 570 of "intrinsic timeless nature".571 Rather, those values have been used to create a ‗new‘ tradition to explain Chinese behavior in ―obliviousness to its historical and social complexity‖.572 For political purposes, Confucianism was since the 1980s often presented in a reduced form with only useful elements for ones purpose picked out. The recalling of certain virtues and traditions suited the purpose to limit Western influences on the Chinese culture and to create a distinct 'Chineseness'.573 This suppresses the structural context within which this Capitalism did arise, the ‚tradition‘, existing outside of historical time, served as a justification for the recent developments.574 Turning Max Weber‘s arguments upside down, American and Chinese researchers tried to establish the existence of ahistorical, timeless Chinese values in a form of Orientalist economics. This means that for them a Chinese ‗essence‘ exists, different from the Western individualistic, conflict-ridden society.575 Both lines of research reduce Confucianism to a ―timeless mystification of cultural traits‖ to create an effective means to explain the specifics of China‘s experience with Capitalism.576 It is indeed true that Confucianism has a very long tradition in Chinese society, but the impact of it over the centuries is more than variable. Some authors577 even argue that NeoConfucianism was invented by US researchers, and then taken up by Chinese scientist as a convenient way to explain the Chinese success, therefore reinforcing the belief in their own distinctiveness. In posing a dichotomy between the Western and Chinese culture, researchmodel and concerned about his own place in history, Mao threw China's cities into turmoil in a monumental effort to reverse the historic processes underway. It was a struggle for power within the Communist Party of China that manifested into wide-scale social, political, and economic chaos, which grew to include large sections of Chinese society and eventually brought the entire country to the brink of civil war. See Yergin and Stanislaw, 1999.

For example, China‘s non-fiction book of the year 2007 was Thoughts about the Confucian Analects by Yu Dan. Maybe this is a sign of people looking for orientation and values in times of social and economic transition. On the other hand – if Confucian values are as ubiquitous as is claimed, why should Chinese people want to buy yet another a book about it? In: Frankfurter Allgemeine Sonntagszeitung, 12. September 2007, p. 57.

Dirlik, 1997, p. 314.

Yang, 1994, p. 35.

Dirlik, 1997, p. 315.

Fahr, 2000: Ommerborn, Wolfgang: Die Politisierung der Konfuzius-Debatte, p. 86-122, p. 117.

Greenhalgh, 1994, p. 749.

Greenhalgh, 1994, p. 747ff.

Zurndorfer, 2004, p. 1.

For example Dirlik, 1997.

ers try to prove that Capitalism is a universal rational construction, no matter in which kind of society it arises.

For family businesses this means a structure of vertical stability that is built upon morality and not thread, and depends on the responsibility of the bosses for their subordinates.

Family firms are thus organized in a paternal, authoritarian pattern. Additionally, the family is regarded as the only organization that can be trusted.578 Having to obey a certain role, the individual is subordinated to the family (or the collective), thus showing loyalty and obedience. The appeal to the honor of the family, especially through education and learning, is also an essential feature of Confucianism.579 In addition, it also suppresses class and gender differentiation. The ideology of authoritarianism is exported as solution for development also in a political context. The Confucian revival celebrates loyalty and obedience as keys to the stability of family and workplace.

Authoritarianism is instrumentalized ―in the cause of a capitalistic regime of discipline‖ to control a social situation ―that no longer is subject to the hold of traditional values‖. Thus, it is difficult to describe the emphasis of patriarchy as typical Confucian value as persistence of ‗old‘ tradition and as distinguishing feature of ‗Chineseness‘.580 This is even more doubtful, when also taking into account that during the Cultural Revolution Confucianism was dismissed as being part of an old regime which did not have space in the Chinese society of the time.

The emphasis on Confucian 'rational' values served not only the purpose of contrasting it with the issue of Guanxi that is often associated with ―an older ethics of personalistic loyalties and indebtedness‖, which from a ―linear teleological scheme of history imported from the West‖ perspective is received as backward.581 It also created a Chinese identity build upon Confucian values that assimilates a ―Chinese tradition to the values of European Capitalism‖.582 The intention of that is to define Capitalism as a unique purposiverational action with the same characteristics no matter where it arises, thus denying that varieties of Capitalism can exist. This also emphasizes the unique ‗Chineseness‘ of it which at the same time has the same features of rationality than Capitalism elsewhere has and thus cannot be backward. In doing so, the Chinese success could be explained by creating a distinctive ―Chineseness‖, at the same time denying that the logic of Chinese Capitalism is different from other forms of Capitalism. As Dirlik summarizes: ―The insisRedding, 1993, p. 208.

Heberer and Weigelin, 1989, p. 184, Hamilton, 1990, p. 92. and Krieger, 1990, p. 118, 222ff.

Dirlik, 1997, p. 317f.

Yang, 2002, p. 462.

Dirlik, 1997, p. 313.

tence on essentialist Chinese characteristics erases the historicity of being Chinese to produce a Chinese identity resistant to time and space‖. In a ―self-orientalization‖583 it denie[s] history […], substituting for historical temporalities and spatialities dehistoricized and desocialized cultural characteristics‖.584 In turning Orientalism upside down, the ‗other‘, Eastern, culture is seen in the research work on Confucianism as superior to the Western culture by both Western and native researchers.585 However, the concept of reciprocity which is typical for Guanxixue586 can be found in three sources: in Confucian ethics, in the knight-errantry tradition and in the Buddhist notion of retribution. As many researchers feel that Chinese Capitalism is a Capitalism with a spirit inspired by Confucianism to it, comparable to the Weberian notion of a ‗spirit of Capitalism‘, only the first point will be emphasized. Throughout this work it is argued that it is actually a Guanxi (network) Capitalism rather than a ‗Confucian Capitalism‘, the latter using Confucian values to prove the distinctiveness and superiority of the Chinese way to make business.

During the 1980s the emphasis shifted to Confucian values as the main element and explanation of a Chinese Capitalism, later this was again dismissed and exchanged by the notion of a network (Guanxi) Capitalism.587

4.5. Varieties of Capitalism and China 4.5.1. The Varieties of Capitalism approach and China Weber's ideal-type conception of Capitalism can also be found within the Variety of Capitalism approach (VoC).588 In recent years a vast amount of literature and much discusOrientalism refers to the study of the East by Western researchers shaped by the attitudes of European imperialism in the 18th and 19th century. It implies traditional inherently ideological and prejudiced outsider interpretations of Eastern cultures. It creates a divide between East and West that situates the West as a superior culture. This viewpoint was coined by Edward Said in his 1978 book Orientalism, stating that any historical discourse has to be placed within a particular framework whose overall structure is necessarily ideological. People in the West studying the East – an inferior culture by definition-, do so within an already coded discourse. See Said, 1979.

Dirlik, 1997, p. 319, 322f.

Greenhalgh, 1994, p. 749f.

Expression, coined by Yang, 1994, referring to the ‗art of Guanxi‘, see chapter 6.

Please see chapter 6 for a detailed discussion on Guanxi Capitalism.

Economic sociology provides a similar framework, see for example Smelser and Swedberg, 1994 or Nee and Swedberg, 2005. The latter combines the insights of institutional economics with new economic sociology to better understand capitalist institutions. Capitalism core principles are seen as ―exchange and the feedback of profit into production‖ on a market that is ―the central institution in capitalism‖ (p. xxxv, 7, 12). As McNally, 2007b notes, the editors neglect the role of ―state elites and of conflicts among social interest groups‖ (p. 19). A similar cross-disciplinary analysis is undertaken by Coates, 2005 who mostly makes the point that his approach is difficult, yet the only one that might result in real insights into the workings of a capitalist system. However, please refer to chapter 3.1 on the notion of economic sociology, and especially Mark Granovetter on networks, trust, and embeddedness.

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