We study how Chinese private entrepreneurs benefit from participating in politics. Using original hand-collected data on listed firms controlled by private entrepreneurs, we document a significant positive relationship between political participation and change in firm performance. We also...

This article tests several predictions of tournament theory on executive compensation in the context of a transition economy. Using an unbalanced panel of 34,701 executives in 1,386 public listed firms in China during 1999 and 2006, the paper finds that (1) pay increases as executives move up...