Indirect Cronyism and Its Underlying Logic

Speaker: Dr. Xiaoping Chen (University of Washington)

Venue: Room 723, Building A, SOM, Zijingang Campus

Abstract: Indirect cronyism is a phenomenon in which managers show favoritism to indirect guanxihu subordinates who have informal, particular, and personal connection with a third party (e.g., another manager) and demonstrate its prevalent existence in Chinese organizations. We explore the crucial factors that may exacerbate managers to engage in indirect cronyism, and the downstream consequences on other members of the organization. We draw on the indirect reciprocity logic embedded in social exchange theory to predict two underlying motives to explain why managers engage in indirect cronyism: (a) fulfilling their felt obligation to favor the indirect guanxihu subordinate, and (b) strengthening their own guanxi with the third party. Results from three scenario-based experiments and one field study sampling a total of 1,559 working adults provide consistent support for our theoretical reasoning and hypotheses. We discuss the theoretical contributions this paper makes to advance the guanxi and cronyism literature, as well as the practical implications of our findings in Chinese organizations and beyond.

Profile of the speaker: Dr. Xiaoping Chen is Philip M. Condit Endowed Chair Professor in the Michael G. Foster School of Business, University of Washington. Dr. Chen is an elected Fellow at American Psychological Association and Society for Industrial and Organizational Psychology. She has served as Editor-in-Chief for Organizational Behavior and Human Decision Processes (2010-2016) and is currently the Editor-in-Chief for Management and Organization Review. Professor Chen’s research interests include cooperation and competition in social dilemmas, teamwork and leadership, entrepreneur passion, Chinese guanxi, and cross-cultural communication and management.