The State-Owned Enterprise as an Identity: The Influence of Institutional Logics onGuanxiBehavior

Abstract

ABSTRACTPrevious research has debated whetherguanxipersists or declines with the development of formal institutions. This study addresses this debate by investigating how the development of formal institutions in China's state-owned organizations influences employees’guanxibehavior. Building on institutional logics theory, I propose thatguanxibehavior is a reaction to the socialist institutions adopted by state-owned enterprises (SOEs) and is associated with the collective identity of SOEs. Thus, employees’ identification with SOEs is the mechanism that influences theirguanxibehavior. A survey of 721 employees from 12 organizations comparedguanxibehavior across three types of organizations with different degrees of state ownership: SOEs, public firms, and joint ventures. The results showed that the employees of joint ventures identify less with SOEs and engage in lessguanxibehaviors than do SOE employees. The employees of public firms still identify with SOEs, and theirguanxibehavior did not differ from that of SOE employees. Identification with SOEs mediated the effect of organizational type onguanxibehavior, whereas formalization did not. Therefore, the development of formal institutions does not necessarily decreaseguanxibehavior, and its effect depends on whether the collective identity underlyingguanxiis changed. This study has important implications forguanxiresearch, institutional logics theory, and transition economies.