Membership Premium or Self-Selection? Communist Party Recruitment and Social Stratification in Urban China

Although a large literature has found the enduring income advantages of Communist Party members in post-reform socialist economies, little is known about whether these advantages are due to real membership premium or self-selectivity. Using data from the Chinese General Social Survey, our analysis based upon the Heckman two-stage approach incorporates the application process into the examination of Communist political recruitment, providing compelling evidence for the following findings. First, although education and father's Party membership significantly improve the incentives to apply for joining the Party, they are not relevant determinants in the Party's screening process. Second, the income gap between rejected applicants and Party members is much smaller than between non-applicants and applicants, showing that the commonly observed income premium is largely due to self-selection rather than Party membership per se. Third, the Communist Party rewards its members through the distribution of career opportunities. Our research sheds some new light on the sustainability of the Communist ruling power, by linking the political recruitment process to stratification outcomes.