Myth and Reality in Chinese Financial Cliques in 1936

Much of current scholarly work argues that China and Chinese communities are distinguished by a culturally specific and unique pattern of networking based on personal relations (guanxi), but there is little agreement about whether such personal relations produce discrete factions or more disbursed, weblike connections. The literature on banking networks is similarly unclear, and most discussion has focused on regional groups, such as a clique made up of natives from Zhejiang and Jiangsu provinces, or shared professional values among bankers. None of these approaches adequately describes actual connections, and this case study provides a new and empirically broad approach that applies tools of network analysis to interlocking bank directorships in 1936. This analysis shows the existence of twenty-four isolated banks; three very small, discrete, and regionally based groups; and one huge, diffuse, and weblike bank network that included virtually all Chinese bank assets and extended to most of China’s economically developed regions.