Economic rewards to political office-holding in a marketizing economy: The case of rural China

Why does political office-holding continue to provide incumbents economic rewards in the transition out of state socialism? And where exactly in the economic process is such politically based advantage generated? Focusing on rural China, this study seeks to contribute empirically by identifying private entrepreneurship and off-farm wage employment as the main venues on which political advantage is generated. I also propose the recyclable power theory. The existing convertible power theory stresses elite actors' capability of converting redistributive power into assets separable from the old offices and valuable in markets. Officeholders can thus gain advantage in spite of their offices. The recyclable power theory argues that as the redistributive state is transformed to a regulatory state, bureaucratic offices acquire new market-oriented power, which then enables officeholders to also derive political advantage because of their offices. Together, these two theories effectively explain the diverse mechanisms that sustain political advantage in market transition.; In the five empirical chapters, I use two complementary survey data sets---one provincial, one national---and multilevel regression models to test derived hypotheses and search for political advantage among various economic activities. Rural cadres in China have largely opted out of agriculture, but have strengthened their advantage in the nonagricultural sector. Although land markets now make it possible and legitimate to convert political power into larger land holdings, with limited incentives and restricted capacity, rural cadres have not done so. Nor do they have advantage in farm production. But on the contrary, even in the fully market-integrated rural economy of China's Zhejiang Province, cadres have significant advantage in the off-farm sector. This pattern of divergence in the two sectors also holds true nationally. The 1996 national data show that cadres with managerial experiences have converted their expertise into private entrepreneurship. Benefiting from transfers of public assets, cadre-run family businesses also generate greater revenues. Finally, cadres rely on their newly acquired regulatory and predatory power to gain advantage in wage employment. The market-oriented power allows cadres to insulate themselves from damages caused by the decline of the rural redistributive economy.