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The emergence of new forms of production in postcommunist economies has been accompanied by the resilience of informal, particularistic social ties. Although China's economic reforms have been more gradual and have not been accompanied by an abrupt regime change, institutions such as the Township and Village Enterprises (TVEs) reflect this duality. Although now well-established components of China's rapidly growing economy, TVEs are also marked by informal, particularistic social ties (such as ethnic or personal networks). A close look at the internal organizational dynamics of TVEs suggests that these ties are not necessarily dysfunctional. In fact, as new institutions while establishing and consolidating themselves, managers of TVEs can take advantage of the familiarity and trust created by these more personal, particularistic ethnic ties as they recruit new workers and expand their productive capacity within a new market environment. A comparison to emergent forms of production in Russia, however, reveals that the persistence of informal, particularistic social ties is not always a positive feature of postcommunist economic institutions. In Russia, informal social ties tend to be based on more instrumental considerations on the part of both patrons and clients, and tend to generate less positive outcomes for the enterprises as a whole. Thus, the long-standing significance of "native place" identity in China's industrial economy may prove to be a more fruitful source of social capital for the consolidation of TVEs than is the case with the more diffuse and fragmented ties characterizing informal social networks in Russian enterprises. In the long run, however, there will likely be some convergence among successful firms in both countries in that they will have to combine elements of community with flexibility to thrive in the fast-changing environment of post-Fordist global capitalism. [ABSTRACT FROM AUTHOR]