Social Embeddedness, Power Balance, and Rural Governance in China

Abstract

This research reconciles the positive and negative perspectives of the role of informal institutions in local governance. It argues that local governance outcomes are jointly determined by social embeddedness -- the extent to which local community leaders connect with their community members through informal ties, and power balance -- the extent to which political power is balanced among local ruling elites to prevent it being capture by informal groups. Using a four-round survey (2005-2016) in rural China, we find that where village officials are more socially embedded and political power is monopolized by a clan, rural households received lower land-taking compensation, administrative expenditure increased, and public investment, although increasing, were unable to meet the public’s needs. Three mechanisms are at work: village officials from the monopolized ruling clan are better able to fragment collective resistance, buy off aggrieved villagers, and collude with the state.