Business to government (B2G) corruption and resource misallocation : the case of China at the municipal level

This paper examines Business to Government (B2G) corruption in China. It contributes to existing empirical analyses in several ways. First, it draws on an extensive literature review of the cultural practice of guanxi that often facilitates corruption. Second, it offers new perspectives by focusing on the much-overlooked corruption issue on a local, and municipal level. Furthermore, it is examined how the Chinese cultural practice of guanxi, in which citizens cultivate a relationship with public officials via gift-giving, contributes to this confined municipal corruption. For this reason, the introduction of performance matrices that evaluate public officials according to various indicators and the implementation of safe avenues for complaints are suggested as more immediate solutions to low-level corruption. Therefore, any anti-corruption measures should also target public officials at the local level to ensure that they do not abuse their power.