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This paper explores the role of favor exchange practices—Chinese guanxi and Russian blat—on investment and entrepreneurship. In both societies policies which supported marketization were undermined by actual institutions, including an insufficient legal structure for enforcing contracts. But cultural resources armed Chinese and Russians differently to react to these circumstances. Guanxi practice allowed people to create networks, to build trust, and to reach out. It was a tool which could be used to build enough trust to allow business transactions to succeed—capitalism without contracts. In contrast, Russian blat devolved into corruption, and faded in importance for ordinary citizens. Without a way to build trust or extend networks, Russians retreated into defensive involution, and engaged in predatory behavior against those outside their small circles of friends. Instead of capitalism without contracts, Russia suffered the depredations of capitalists without capitalism.

This article uses an institutional approach to examine Chinese NGOs as an emerging organizational field. In mature organizational fields, the organizations are powerfully constrained to follow the institutional practices of that field. However, in an emerging organizational field, the institutionalized constraints are not yet established, so actors can try out a wide range of practices. Some of these practices will become the new "rules of the game" of the organizational field when it is established. The content of these rules will shape the relationship between NGOs and the Chinese party-state for future generations. We find that a Chinese NGO's resource strategy is shaped by two interacting factors. First, NGOs operate in an evolving ecology of opportunity. Second, the social entrepreneurs who lead Chinese NGOs perceive that ecology of opportunity through the lens of their personal experiences, beliefs and expertise. As a result, the initial strategies of the organizations in our sample were strongly influenced by the institutional experience of their founders. Former state bureaucrats built NGOs around alliances with party-state agencies. In contrast, NGO founders that had no party-state experience usually avoided the state and sought areas away from government control/attention, such as the internet or private business. (China Q/GIGA)

AbstractThis article uses an institutional approach to examine Chinese NGOs as an emerging organizational field. In mature organizational fields, the organizations are powerfully constrained to follow the institutional practices of that field. However, in an emerging organizational field, the institutionalized constraints are not yet established, so actors can try out a wide range of practices. Some of these practices will become the new "rules of the game" of the organizational field when it is established. The content of these rules will shape the relationship between NGOs and the Chinese party-state for future generations. We find that a Chinese NGO's resource strategy is shaped by two interacting factors. First, NGOs operate in an evolving ecology of opportunity. Second, the social entrepreneurs who lead Chinese NGOs perceive that ecology of opportunity through the lens of their personal experiences, beliefs and expertise. As a result, the initial strategies of the organizations in our sample were strongly influenced by the institutional experience of their founders. Former state bureaucrats built NGOs around alliances with party-state agencies. In contrast, NGO founders that had no party-state experience usually avoided the state and sought areas away from government control/attention, such as the internet or private business.