The Role of the Guanxi Institution in Skill Acquisition Between Firms : A Study of Chinese Firms

Research output: Journal Publications and Reviews (RGC: 21, 22, 62)21_Publication in refereed journalNot applicablepeer-review

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Original languageEnglish
Pages (from-to)3-23
Journal / PublicationJournal of Supply Chain Management
Issue number4
Early online date5 Dec 2013
Publication statusPublished - Oct 2014


The prevalence of personal connections in China, or guanxi, constitutes an institution that governs how people exchange favors. This study explores the effects of the guanxi institution on interfirm relational ties, information sharing, and the acquisition of skills across firms. According to social network theory, the marginal benefit of interfirm relational ties on information sharing should decrease with the strength of ties; according to information overload theory, information sharing should have an inverted U-shaped effect on the acquisition of skills. Institutional theory further suggests that the links across these three constructs are subject to the influence of the guanxi institution. With data collected from 338 manufacturing companies, this study shows that the links differ across environments that have strong versus weak guanxi institutions. A strong guanxi institution generally promotes information sharing and skill acquisition, but it also has a dark side.

Research Area(s)

  • Acquisition of skills, Guanxi institution, Information sharing, Institutional theory, Relational ties, Social network theory