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The Limits Of Career Concerns In Federalism: Evidence From China

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  • Petra Persson
  • Ekaterina Zhuravskaya

Abstract

Performance-based promotion schemes in administrative hierarchies have limitations. Chinese provincial leaders, despite facing strong career concerns, make different policy decisions depending on their career backgrounds. Provincial party secretaries who rose from low to high positions within the province they govern ("locals") spend a higher share of budgetary resources on education and health care and invest less in construction infrastructure than party secretaries who made their most significant career advancements in other provinces ("outsiders"). Identification comes from variation in central leadership and term limits. As the promotion mechanism rewards infrastructure investments, locals are less likely to be promoted at the end of the term. We explore various mechanisms and provide evidence that the difference between locals and outsiders is not driven by knowledge or experience. Several pieces of evidence suggest that locals cater to low-level provincial elites, who helped them rise to power. Thus, local career trajectories limit the power of career concerns by fostering competing allegiances.
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Suggested Citation

  • Petra Persson & Ekaterina Zhuravskaya, 2016. "The Limits Of Career Concerns In Federalism: Evidence From China," Journal of the European Economic Association, European Economic Association, vol. 14(2), pages 338-374, April.
  • Handle: RePEc:bla:jeurec:v:14:y:2016:i:2:p:338-374
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    File URL: http://hdl.handle.net/10.1111/jeea.2016.14.issue-2
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    Cited by:

    1. Quoc-Anh Do & Kieu-Trang Nguyen & Anh N. Tran, 2017. "One Mandarin Benefits the Whole Clan: Hometown Favoritism in an Authoritarian Regime," American Economic Journal: Applied Economics, American Economic Association, vol. 9(4), pages 1-29, October.
    2. Mercier, Marion, 2016. "The return of the prodigy son: Do return migrants make better leaders?," Journal of Development Economics, Elsevier, vol. 122(C), pages 76-91.
    3. repec:spr:ecogov:v:18:y:2017:i:4:d:10.1007_s10101-017-0197-5 is not listed on IDEAS
    4. Jiankun LU & Pi-Han Tsai, 2017. "Signal and Political Accountability: Environmental Petitions in China," Economic Growth Centre Working Paper Series 1711, Nanyang Technological University, School of Social Sciences, Economic Growth Centre.
    5. Quoc-Anh Do & Kieu-Trang Nguyen & Anh N. Tran, 2017. "One Mandarin Benefits the Whole Clan: Hometown Favoritism in an Authoritarian Regime," American Economic Journal: Applied Economics, American Economic Association, vol. 9(4), pages 1-29, October.
    6. Quoc-Anh Do & Kieu-Trang Nguyen & Anh N. Tran, 2017. "One Mandarin Benefits the Whole Clan: Hometown Favoritism in an Authoritarian Regime," American Economic Journal: Applied Economics, American Economic Association, vol. 9(4), pages 1-29, October.
    7. Thomas Stoerk, 2017. "Compliance, Efficiency and Instrument Choice: Evidence from air pollution control in China," GRI Working Papers 273, Grantham Research Institute on Climate Change and the Environment.
    8. Juan Carlos Suárez Serrato & Xiao Yu Wang & Shuang Zhang, 2016. "The Limits of Meritocracy: Screening Bureaucrats Under Imperfect Verifiability," NBER Working Papers 21963, National Bureau of Economic Research, Inc.
    9. Chen, Ting & Kung, J.K.-S., 2016. "Do land revenue windfalls create a political resource curse? Evidence from China," Journal of Development Economics, Elsevier, vol. 123(C), pages 86-106.
    10. Pranab Bardhan, 2016. "State and Development: The Need for a Reappraisal of the Current Literature," Journal of Economic Literature, American Economic Association, vol. 54(3), pages 862-892, September.

    More about this item

    JEL classification:

    • H11 - Public Economics - - Structure and Scope of Government - - - Structure and Scope of Government
    • H70 - Public Economics - - State and Local Government; Intergovernmental Relations - - - General
    • P26 - Economic Systems - - Socialist Systems and Transition Economies - - - Political Economy

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