Why China Thrives Despite Corruption
11:00 a.m., Tuesday, Aug. 28, 2007
Webster Hall Auditorium
Admission: free

It is commonly believed that corruption distorts the allocation of resources by diverting much-needed capital from economic development into corrupt officials’ pockets. Thus high-level corruption in a country is considered detrimental to its economic growth. However, some countries such as China have achieved rapid economic growth in spite of rampant corruption. Dr. Shaomin Li will describe how China is best known for its culture and practice of guanxi, which refers to the informal social networks based on the private relationships among people. In China, due to the monopoly of most economic resources by the government, corruption is rampant. The widely accepted view in China is that “power cannot be deposited in a bank, so you had better profit from it while you can.”

Dr. Shaomin Li is a professor of international business at Old Dominion University in Norfolk, Virginia. Born in China in 1956, he witnessed the rise of Mao, the Great Leap Forward and the subsequent famine (1958-1963), and the Cultural Revolution (1966-1976). With only three years of grade school, Dr. Li entered Peking University through self-learning and went on to receive his Ph.D. from Princeton. In 2001, he was detained by the Chinese secret police for his pro-democracy activities. Under strong condemnation from the international community and the heavy criticism from the U.S. government, the Chinese government released him after five months’ detention.