Can Political Connections Improve Foundation’s Acquisition of Resources?

Abstract

By artificially sampling 305 Chinese foundations, the paper conducts an empirical study on how political connections influence foundations’ acquisition of resources. As it turns out, the influence of political connections on foundations’ policy resources is insignificant, and this does not change with the changes of the nature and sector of the foundation and the degree of marketization of the environment it is in. Political connections have significant influence upon donations, particularly those from domestic natural persons – this is particularly true with public-fundraising foundations, public-service foundations and areas where marketization is at a relatively low level. The influence of the extent and depth of political connections on the foundation’s acquisition of resources fails to pass the significance test. The conclusion the study arrives at implies that on the part of the government, policies should not focus on banning Party and government cadres from holding a concurrent post in a foundation, but on how to regulate their acts and prevent them from seeking private gains by taking advantage of its concurrent post of director; and that on the part of the foundation, in the current context, it can seek to establish political connections and increase its capacity of attracting donated resources.