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

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of a network depends mainly on the effort of individuals to expand especially their reliable and effective zones. Social distance is symbolized by the value of a gift and the occasion when it is given. Everyone is aware of the rules of gift-giving, whether it is how much to give or when it is appropriate to present a gift. For practical reasons, villagers often use gift-lists they can refer to when they need to make gift in return. It is also differentiated between gift-giving among family and kinship during festivals (like Lunar New Year) and "giving Rénqíng". The latter takes place at weddings, funerals or other ritual occasions and is in contrast to the first voluntary. This means, that there are no fixed amounts or types of gifts which gives the opportunity to show affection and establish personal relations.1009 Gifts have the attribute to be generous and voluntary but at the same time creating obligations that must be reciprocated, with the failure to do so placing the recipient in a subordinate position.1010 In his article, Yan defines a ―social space of Guanxi‖ which identifies the degree of intensity of personal relations, with a very clear-cut border between the inside and outside of a village community.1011 This social space also constitutes the society for an individual, which is why Guanxi is also called shèhuì (society). As mentioned above, individuals, who do not interact and therefore do not have any kind of Guanxi, are not considered a respectable person (bùhuì zuòrén). This can have severe consequences for those individuals in times of emergency. One of the most important features of Guanxi is the mutual support during hard times, which during the 20th century was especially true for the decade of the Cultural Revolution, when Guanxi in general became more instrumental (see also below).

Peasants had to maintain good relations with officials through gift-giving or other social favors to ensure to be assigned to lighter work or receive better work evaluations. Also, young people 'sent down' to the countryside had to put much effort in building up networks to be able to return to the cities as soon as possible again. Nevertheless, the notion of "giving Rénqíng" also never died during the Cultural Revolution even if the peasants were ordered to refrain from those 'feudal' traditions because they represent a "wasteful practice".1012 Whereas in cities it is possible to interact among total strangers, in a village community all activities will be with people connected through Guanxi. This means, an individual will intermingle mostly with people from its network who are the same ones exchanging gifts Kipnis, 1996, p. 293ff. and Yang, 1994, p. 312.

Bourdieu, 1977, p. 195.

Yan, 1996a, p. 5.

Gold, 1985, p. 669 and Yang, 1994, p. 313.

on a regular basis. Historically, this was very important, because due to instable social conditions, only people with whom a long-standing relationship was established could be trusted.1013 Thus, for Guanxi connections family structures are very important, the closest connection always being immediate natal family. Personal relationships are mostly not built upon individual autonomy but rather inherited through already existing networks of one‘s family.1014 Guanxi is a dynamic structure with constant interactions necessary to establish new ties or to sever old ones. Individuals need to take care of the people in their network by giving assistance in everyday life, therefore fulfilling all kinds of obligations, such as gift-giving.

Hence, cultivating Guanxi can get very complicated and also economically costly, as gifts need to be of a certain value to be accepted. Additionally, building and maintaining a Guanxi network entails huge social costs and is very time consuming. Particularly during socialist times, gift-giving was often limited by poverty and state restrictions. Yang gives the example of a woman leaving the countryside to work in Beijing. Although she would very much like to go back for visits, she simply cannot afford it. The gifts necessary for all acquaintances would cost her the wages of several months. But going back without providing the necessary gifts would cost her social credit and face. Visiting also means to be forced to accept invitations to countless banquets. Without having the means to either return the many invitations or give adequate gifts, the visitor has no choice but to refrain from visiting her home village at all.1015 This shows clearly that gift-giving not only entails a material side but maybe even more a symbolic one, as expressed in the term 'face' already mentioned above.

Women play an important role in maintaining inter-village or inter-lineage relations.

Especially married women who moved to their husbands' villages keep close links to their natal families and home villages. Also, females are additionally often responsible to maintain, expand or establish relations within their own village in their exchange of cooked goods or childcare. It is interesting to note that the female component of relations is mostly the horizontal one, bringing different social groups together, while the male sphere is to "fix individuals into kin groups based on a tracing of roots", thus providing stability and security.1016 Yang, 1994, p. 75f.

Yan, 1996a, p. 9.

Kipnis, 1996, p. 300ff and Yang, 1994, p. 112f. and p. 313.

Yang, 1994, p. 315f.

To conclude, traditional Guanxi emphasizes gift-giving on a local level and is less concerned with a more instrumental and what Yan calls extended form of Guanxi.1017 Nevertheless, it shows an inverse relation between material loss and symbolic gain. Thus, contrary to Western rational thinking, giving away wealth and generosity helps gaining money, and, probably even more important, helps to maintain and develop social status and facilitates doing business.

6.1.3. Guanxi as evolving institution As already mentioned in chapter 4, the ―art of Guanxi‖ or ―the art of personal relationships‖, also called Guanxixue, means the ―study of connections‖ or ―Guanxiology‖. It emphasizes „the binding power and emotional and ethical qualities of personal relationships‖.1018 It is also defined as a ―gift economy‖ because it calls upon obligations such as giving, receiving and repayment and unifies material and moral, symbolic aspects of life.

The gift is never fully separated from the giver, establishing an indissoluble connection.1019 Although Guanxi defined like this cannot be said to be utilitarian, it can still expose signs of instrumentalism, in the sense that generous gift-giving serves as a means to invoke reciprocity therefore also certain intentions. Hence, there are voluntary and forced elements of giving and thus of Guanxi.1020 Most notably during the post-Mao era of the 1980s and 1990s, particularism and instrumentalism increasingly dominated behavior, using ritualized relationships to gain material benefit.1021 Guanxi in this sense emphasizes its instrumental side but in general is a very complex phenomenon. Guanxi is not only a ―strategically constructed network of personal connections‖ that deals with bureaucracy to the end of accessing desirable resources, it is additionally intertwined with social institutions such as family, kinship, neighborhood and community.1022 Due to Chinese society changing very quickly with some kind of Guanxixue being in use in all epochs, it can be said it is ―best treated as a multifaceted ever-changing set of practices‖.1023 Guanxi has a long history in China and proved to be very adaptable in the past, especially its changing utilization in different historical circumstances. Although the concept of Guanxi can be traced far back in Chinese history, its re-emergence can be attributed to the Cultural Revolution. Guanxi as a social practice is able to adapt to new institutional arYan, 1996a, p. 23f.

Yang, 1994, p. 8.

Mauss, 1966, p. 31.

Yang, 1994, p. 8.

Yan, 1996a, p. 3 and Yang, 2002, p. 460.

Yan, 1996a, p. 3.

Yang, 2002, p. 459.

rangements, be it socialism, be it Capitalism, but it is still not a timeless feature independent of political context. Even before the Cultural Revolution it was custom to give banquets and gifts in a reciprocal manner. It would therefore be easy to conclude that China has always been a personalistic, kinship-oriented society. As much as this cannot be dismissed as wrong, it still oversimplifies culture as being a static phenomenon. Cultural and social structures are dynamic and subject to changes over time. Cultures are changing and personalism may change or be reconstructed, which can be shown in the description of the difference between traditional and modern Guanxixue, which indicates the historicity of Guanxi.1024 However, the Cultural Revolution is often seen as turning point for relationships becoming more manipulative. This decade is also associated with declining moral standards in society. The results of relationships are not mere material gains or granted favors, but ―the discernment, acuity, and cunning needed to get by in life‖ affected the essence of connections.1025 That is due to the fact that in the time of the Cultural Revolution cutting through bureaucratic procedures was hard. It was necessary to ensure the supplying of resources or even surviving due to the loss of social order and organizational discipline without personal connections. The Cultural Revolution therefore ―unleashed ‗feudal remnants‘ of thought with people more relying on personal relations than the state due to the social chaos of the time".1026 The Communist Party also tried to substitute friendship by comradeship. The latter required people to treat all personal contacts equally. An ―absence of a private ethic to supplement the public ethic and support the commitment of the individual to his friend‖ was created.1027 The Cultural Revolution made social life highly politicized and unpredictable, living standards stagnated. Due to the irrationalities of the system, Guanxi exchange became highly political, serving mainly the purpose of getting permissions or facilitating other bureaucratic necessities.1028 It was assumed that Guanxi as supposedly less efficient institution would vanish in favor of contractual relations in a fully established market economy because in a modern rational capitalist society with contractual certainties, freedom of trade, prices determined on a free market, private savings and tradable factors of producYang, 1994, p. 152f.

Yang, 1994 also noticed another facet of this: „I found that women, more than men, objected to the aggressive tactics […] to the use and manipulation of people. Men tended to have an accepting attitude toward Guanxixue‘s instrumentalism, regarding it in a realistic light as something one had to do in order to accomplish certain tasks.‖, p. 52f.

Yang, 1994, p. 147.

Vogel, 1965, p. 59.

Shirk, 1993, p. 13f.

tion Guanxi is made obsolete. Quite the opposite has been the case: Although the necessity to overcome bureaucratic hurdles was waning, Guanxi practices increased enormously in the aftermath of the Cultural Revolution. Guanxi adapted to the new institutions in the emerging ―capitalist developmental state‖, rather than fading away or being exchanged for rational-legal institutions imposed by the state able to allocate goods independently of personal networks.1029 Guanxi became a more material exchange during the 1980s to facilitate the reviving of the private sector during economic reforms. While mostly ordinary people practiced Guanxi during the planned economy, it became an instrument of businessmen afterwards.1030 Guanxi is often seen as a ―shortcut around, or a coping strategy for dealing with, bureaucratic power‖.1031 Due to a Chinese bias against codification, key skills for doing business in China ―are [...] those of negotiation; the name of this game is not to economize on bounded rationality or to exorcise opportunism but to capitalize on them in a linked network of hierarchical face-to-face relationships in which personal power is traded, using loyalty, compliance, and protection as the medium of exchange‖.1032 During the rural economic reforms of the 1980s, it was also highly essential to engage in Guanxi. With the growth of rural enterprises, peasant entrepreneurs had to employ in networking to obtain resources and secure markets in other regions. Part of running an enterprise is always to maintain good Guanxi relations, especially to government officials to ensure the provision of supplies.1033 Interestingly, as a result of social reforms, cadres lost some of their power. This often is made visible in not giving gifts for example at a wedding which is one of the most important occasions to display one‘s prestige. Usually, the status of a person can be measured in the amount and value of gifts received. Chinese would typically give presents to their village leaders at such events to recognize their higher standing. Thus, to Chinese refusing to give a present is an obvious sign of lost power and face living in rural areas, especially in rural areas.1034 Another aspect of Guanxi is migration. To be able to move into a city to seek employment is much easier if connections to people already living there have been developed because they might provide accommodation and food.1035 Guanxixue became again the instrument for economic survival, although on different grounds. In the competitive economy of China, entrepreneurs needed to make sure that they could keep up with the market, Yang, 2002, p. 460f.

Yang, 2002, p. 460f.

Yan, 1996a, p. 3 and Yang, 1994, p. 15.

Boisot and Child, 1988, p. 521f.

Yang, 1994, p. 76f.

Yan, 1992, p. 15.

Yang, 1994, p. 77.

to retain, or even better, to raise their profits and to build up good connections to officials.

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