Abstract
What explains drastic variation in local implementation in China? Why are a subset of bureaucrats willing to prioritize expensive and difficult policies while others not? This is not only crucial to policy implementation per se, but also crucial to our understanding of policy multitasking as a challenge of authoritarian legitimation. Extant literature has yet provided a compelling explanation due to its oversimplified understanding of bureaucratic incentive structure. To address this flaw, this dissertation situates bureaucrats in a dynamic political selection system built on the coexistence of merit-based and patronage-based tracks and examines how its configurations impact the risk-reward tradeoffs made by promotion-seeking bureaucrats.
To begin with, I emphasize the dynamic within the system, which is overlooked by the literature. I argue that bureaucrats desire to switch to and remain on the patronage-based track for the benefits of accelerated advancement and a predictable future, and the most popular patronage is that provided by the supreme leader. Moreover, because of the central role of policy achievements in the survival of Chinese Communist Party (CCP), policy implementation, especially identification of policy priority, becomes the key to build patronage relations. Then what policies are most advantageous to gain the supreme leader’s patronage? I argue that prioritizing policies associated with weak indicators in performance evaluation (soft policies) is the most useful. This is because of bias in resource allocation caused by the merit-based selection. Based on evaluations of observable and quantifiable performance, the merit-based selection compels bureaucrats dependent on it to prioritize hard policies (policies associated with indicators that carry heavy weights). Naturally, soft policies, especially difficult ones like innovation policy, receive less consideration. This bias is exercised not only by bureaucrats whose promotion depends on meritocratic evaluation, but also by those involved in patron-client relations with leaders other than the supreme leader, because they are more susceptible to potential sanctions brought by poor performance evaluation results than those of the supreme leader. As a result, only a minority of bureaucrats would likely implement soft policies carefully, despite their importance to the supreme leader's survival. By prioritizing soft policies, implementers can distinguish themselves from the competition.
However, I argue that doing that would result in one of two distinct outcomes: either the bureaucrat gains the supreme leader's patronage and avoids punishment for relatively poor performance evaluation results because of the supreme leader's strong political protection, or the bureaucrat fails to build a relationship with the supreme leader and receives punishment for the poor performance evaluation results. While the first outcome is optimal, the second is a bureaucrat's worst nightmare. To successively gain the supreme leader’s patronage and place oneself in the first scenario, one needs to be close enough to the leader’s network. Such a process of calculation leads to a systematic pattern of priority identification as follows: Proximity to the core network would encourage bureaucrats to take this strategy, because the high likelihood of gaining the supreme leader’s patronage would place her in the first outcome. In contrast, bureaucrats located far from the core network are less motivated to pursue this strategy, as failure to join the core network would result in the second outcome. To avoid this, these bureaucrats are more likely to abandon this strategy from the beginning and adhere to the merit-based track.
I provide empirical support to my argument by investigating how city leaders’ patronage status, that is, their distance to the supreme leader’s network, shape their commitment to implementing (1) tax policy, (2) SO2 emission reduction policy, and (3) innovation policy. I devise a novel strategy to measure patronage status and the quantitative research is conducted on 288 municipal cities in China.
In order to study how bureaucratic incentives impact societal incentives, another important factor to achieve policy objectives, I also investigate how local leaders’ patronage status innovation at the firm level. Drawing on data on Chinese listed firms, the findings suggest that, although local leaders’ patronage status has no direct effect on firm innovation, the changes in it, both immediate and cumulative, negatively impact business efforts to innovate. and such impacts are mediated by firm ownership.
