Marketing Communist Party membership in China

The selection of political officials is under-studied in economic analysis of authoritarian politics. In the absence of elections, the autocracy alone is burdened with the task of selecting the right candidate for every political position. This paper tries to empirically investigate an authoritarian political selection market where a dictator "sells" potentially valuable political membership to eligible supporters who have to pay a "price" in terms of screening cost. We highlight one dilemma that many contemporary autocracies face, namely the need to recruit educated elites who usually have better options in the private sector and are less dependent on the regime. This paper argues that autocracies can minimize this challenge by actively screening for unobservable loyalty conditional on observed technical skills. Using micro-level Chinese Communist Party college recruitment data, we show that the party adopts a discriminative strategy of lowering (but not removing) the screening cost for high-ability students and more intensively screening for loyalty among low-ability students. Using brainwashing course scores as a measurement of loyalty provides suggestive evidence that party members of a given ability level have more loyalty than nonmembers at the same ability level.