Entrepreneurial families and government-business relations : a comparative study on mainland China, Taiwan and Hong Kong

Abstract

This research aims to examine the interactions, transformation and implications of

the government-business relations of entrepreneurial families in Mainland China,

Taiwan, and Hong Kong. The similarities and differences of their operational

patterns, strategies and impacts are also investigated. Establishing the political

dimension as the foundation for this study enables this research to enrich the

understanding of Chinese entrepreneurial families and address the gaps of

conventional theories.

Three influential entrepreneurial families in the cross strait tri-region—the Rong

family in Wuxi, the Koo family in Taiwan and the Fok family in Hong Kong—are

examined, with the application of clientelism and corporatism as the theoretical

framework for analysis. Traditional Chinese values on business and businessmen

are integrated into the theoretical discussion that serves as the basis of critical

review of conventional theories and formulation of a new government-business

relations theory relevant to the context of Chinese societies. All assumptions

leading to such a theory are substantiated through conducting historical reviews

and empirical analysis. This research primarily adopts a qualitative approach,

using multiple case studies, historical and literature review, document analysis

(including opened secret archives), in-depth interviews and field research.

The research argues that such relations are rooted in the traditional Chinese

cultural values and ideologies. With the support of party-state apparatus, or state

apparatus, as well as operational mechanisms at both an individual and

organizational level, the party-state-led or government-led government-business

relations are established and sustained through various pathways. They also come

as an embodiment of political alliance as the individual and organizational

frameworks of corporatism interact and modify each other. It is asserted that an

underlying mechanism is in constant operation to sustain the relational dynamics,

but that such a mechanism cannot be explained in terms of legal considerations.

The government-business relations of Chinese entrepreneurial families present

cooperation but not opposition, and emphasize mutual dependence, trust and

loyalty, which cannot be satisfactorily interpreted with clientelism. Public interests,

or at least the coexistence of public and private interests, characterize the

collaboration between the two parties in question. This research further reveals

that entrepreneurial families undertake more political costs and risks than general

family enterprises. This in turn provides proof of both the positive and the

negative sides of political capital, which can potentially evoke extreme effects and

constitute unstable factors for the development of entrepreneurial families. This

understanding deviates from the past discourse which upholds the view that

participation in government-business relations brings reasonable expectations

about acquiring more interests on the part of entrepreneurial families. A

comprehensive analysis of the involved interests and costs, opportunities and

crises, as well as contributions and disadvantages confronting entrepreneurial

families as a consequence of engaging in such government-business relations?as

well as the manifestation of the distinctive operational models underlying such

relations?are the important contributions made by this research.