Content area
Full Text
Introduction
This paper reviews the evolving role of guanxi in the Chinese economy. We propose that there are two types of guanxi in the history of Chinese culture: the role-based hierarchical guanxi identified by Confucianism and the soil-rooted egocentric guanxi embedded in individuals' daily life. Based on our historical analysis, we investigate these two types of guanxi in today's Chinese economy. Specifically, we empirically test the effects of role-based and soil-rooted guanxi on trust between alliance partners and demonstrate a positive synergy between the two on building interorganizational trust. In this way, we further the research on guanxi and strategic alliances by distinguishing two types of guanxi in Chinese history and linking both to interorganizational trust in the current business environment.
Guanxi in Chinese history
In countries deeply rooted in the Confucian culture, interorganizational relationship is often derived from guanxi - the culture-based informal interpersonal relationships that are widely practiced in the business world ([28] Luo, 2002). We begin our discussion with a review of guanxi throughout the Chinese history.
Two types of Guanxi in Chinese history
Although guanxi has been embedded in Chinese society for thousands of years, systematic research with scientific methods did not prevail until the middle of the twentieth century. Nevertheless, the practices of guanxi are discussed in depth and rooted firmly in the dominant philosophical system in Chinese culture - Confucianism. Since the Emperor Wu of Han Dynasty ( bc 134), the essence of Confucianism had been advocated by generations of emperors. Dynasties of rulers appointed students of Confucian as government officials, reinforcing the philosophy of Confucianism ([25] Liu, 2006). The Analects of Confucius , which is regarded as the bible of Confucianism, endorses the definition of guanxi based on people's social roles. Such guanxi represents a series of hierarchical relationships within government (e.g. emperor vs official), family (e.g. father vs son), and community (e.g. elderly vs youth, teacher vs students). Because people's roles change according to the social contexts, their positions in the hierarchical relationships are adjusted accordingly. To maintain the harmony of the guanxi structure, the Confucianism develops a value system that acts as behavioral guidelines to support the hierarchical guanxi . For example, Confucian scholars emphasize that gentlemen should possess the five virtues so as to...