THE STRUCTURE OF LABOR MARKETS IN THE U.S. AND CHINA: SOCIAL NETWORKS AND OPPORTUNITY HOARDING.

Despite the major cultural and political differences between the U.S. and China, in both countries access to jobs is supposed to be guided by fair and equitable procedures. In the U.S., there is a presumption of an open labor market in which potential employees compete on the basis of their qualifications, where the fairness of decisions are guided by anti-discrimination laws and normative organizational policies. In China, although there is a history of close relationships that guide the exchange of favors, following the 1949 revolution, Communist Party leaders were given the authority to allocate positions in ways that were supposed to eliminate special privileges of class and background. Yet in both the U.S. and China, social connections are an important part of everyday interaction. In the U.S. context, such connections are described as social capital. In the Chinese context, connections are defined as guanxi. A review of research on labor market processes in both the U.S. and China shows that despite the major differences between these countries on cultural values and political systems, the U.S. and China are similar to each other in terms of the extent of social network influence on access to jobs. The implications of the similarities in labor market processes in the context of such different countries are explored in this paper. [ABSTRACT FROM AUTHOR]