Culture and the “Chinese Mindset”

Whether you intend to or realize it or not, most of you going on this trip will one day do business in/with Asia, whether you live there or even if you stay in California.

Rarely will anyone say this openly, but there is a perception among a number of Western businesspeople (not all, of course), including the purported more open minded and “progressive” ones from California, that the Chinese “lie, cheat and steal.”

It is not my role or place tell anyone what to feel or believe. That is up to them to decide, and we all have to deal with those consequences of our beliefs (and the missed opportunities that may go with it), particularly if we are silly enough to make such a statement in public.

Before I open this can of worms, let me make clear from that outset that I am not the “source” of this perception. Nor do I believe it. I merely report what the perception by some is as I have heard it over and over from a number of people. So don’t shoot the messenger. At first blush it seems to me that such a statement or belief, is off-base, it shows a lack of life and business experience, a lack of critical thinking skills, the inability to determine good data from bad, is an over-generalization, etc. I hope we can all agree on that. Moreover, God knows that we have each certainly seen our fair share of Americans who “lie, cheat, and steal”. No country or ethnic group in the world has the monopoly on this, in my view.

Having said the above, one of the things that surprised me with respect to one MBA trip to China is that I think a few students (not all) appear to have returned from China with “some” impression that “you can’t trust the Chinese; they lie, cheat and steal”. When I saw this, I realized that as a professor and college we had missed the mark in some of the pre-trip planning and even during the trip itself by not giving students several “lenses” from which they might analyze and think about this issue before they jumped to such a conclusion. (I am also not sure how one can reach such a conclusion after spending only 10 days or so in any country.)

So, to that end, check out the following recent posts on this very topic: one from the Useless Tree blog (here) and one from the China Hearsay blog (here). I enjoyed reading these posts and in particular their discussion threads. I learned something new, and I have thought a lot about this issue the past few years.

Any conversation about culture often gets heated (nothing wrong with that), and these posts are no different but the comments do show how complex this issue is to look at and analyze. This information and input from these various people will help better prepare you for what you will see in China.

And after you read these posts, come back here and discuss what these posts and their discussion threads teach you about Asia, China, culture and how it is shaped and perceived, our upcoming trip, and yourself?

And what, in a society, shapes “culture” and business conduct? For example, does the standard of living in a country lead to its culture, or does culture lead to a countries standard of living? (Economic scholars have some interesting things to say about this question; e.g., here is a recent SSRN paper of possible interest you can download for free (”Does Culture Affect Economic Outcomes?”), which relates to this discussion). See also the March 27, 2006 related discussion thread on this blog called “The Role of Women in Chinese Economic Activity — students had some interesting things to say on this sub-issue.

Which is more important for you and your future — to understand a culture and look at what forms the behavior at issue, or, to understand how a culture is expressed by those who practice it? Discuss and defend your position.

My experience is that the Chinese have their own sterotypes of Americans — what/how do you think they see us and our culture (in general)? How, in a business transaction, might you take advantage of their stereotypes about you, and is your doing so “lying, cheating, stealing”, just in a different form?

For example, once you see how cheaply a pair of women’s high end brand name dress shoes cost to make in China and how much they are in turn sold for by US retailers to the US consumer, let’s go for a cup of coffee and you can try to convince me that such price gouging by the US retailer … err, I mean what retailers euphemistically call their “markup”, is not “stealing” from the consumers. And yes, blah, blah, blah, I know and appreciate that we all go like sheep to slaughter and pay it, but does that make such business conduct the right thing to do? It may very well be acceptable to do, but I want you/us to at least ask that question.

(I appreciate that you will likely better be able to answer this latter question after we visit English Corner).

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14 Responses to Culture and the “Chinese Mindset”

  1. Corey says:

    I am sorry to say that in many cases this is true. I have lived and worked in China for several years and can speak Chinese quite well. It is much more common for people in China to think it is perfectly normal to cheat a business partner. Sometimes people like to always assume that we as Westerners are ignorant of other cultures. I’ve made plenty of money in China but also had a business partner cheat me on a bad shipment, then sell the product we developed together to my competitors. They proposed ridiculously unfair terms leaving me no choice but to walk away in spite of the losses. Of course we can help prevent problems by learning the culture and language better, but it is still true that ethical standards are higher in some countries than others.

  2. Chris Carr says:

    Hi Corey.

    Thanks for checking in.

    I never know what to make of these types of conclusions. For example, have you never been cheated by a Westerner? Maybe not. I have. Many times. Yet I still don’t know that one can draw a conclusion that “Westerners lie, cheat and steal” ay more than another group of people.

    You may be right. But you may be wrong.

    I have never found convincing data on this issue one way or the other. I have not even found a decent academic study where people even agree on the definition of “cheating”. For example, many firms in the West make a profit that may make one’s eyes pop out. Does that mean they are “cheaters”? Depends on who you ask and what axe they may have to grind.

  3. Corey says:

    Part of it is poverty, the Chinese feel that if they don’t rush to grab every opportunity they’ll be left behind. You see this with cutting in line, driving habits, and in many other ways.

    I talked to quite a few Chinese, and most tended to think it was perfectly normal to not pay a client for a bad container shipment of products. You can argue that some of our companies exhibit bad behavior, but on the whole, I find Western business practices to be more honest. Please keep in mind this is from someone who had been very supportive, in fact in many cases I have spoken in support of China back home.

    I think that in your position you have to play the academic role and say it is all relative. However for people on the ground doing business, it is very important not to be overly naive as some Westerners are who go to China. Investigate potential partners carefully and stand your ground. Getting upset is counter-productive and patience is very helpful.

  4. Chris Carr says:

    Hi Corey.

    Thanks for checking back in.

    I can’t refute your experience with both cultures.

    Mine has just been different.

    I am not playing the be a balanced academic card. In my own life and experience I have met and know a number of incredible and honest people in China and the US. I have also met and know a number of cheaters in China and the US. This includes my role and work as a practicing attorney in the trenches and on the ground; not the ivory towers of the university setting

    I would have to see an agreed upon definition of cheating, and then, meaningful data to support the hypothesis that one group of people cheat more than the other.

    Until then, I make and draw no conclusion either way; and I continue to resist the temptation and natural urge to only focus on data points that confirm my own biases and/or former experiences in life.

    I agree that patience is a good thing and an under utilized tool.

  5. james says:

    I am an American who has conducted business in China for the past 7 years and own 2 companies inside China.

    You are doing your students a big disfavor buy not adequately preparing them for the frequency, magnitude & sophistication of cheating in this country.

    The fact is cheating is rampant in China. It is ingrained in their culture and your students will face it on a daily basis. And they need to be very well prepared. Trust no one. Always get a second opinion; possibly 2 or 3. Have several back up plans. Plan for failure. Be preventative. Conduct any and or all business / relationships 100% on your terms.

    Example: student lies to teacher and gets away with it. Chinese father says, “great job son; your so great becuase you outsmarted the teacher; your going to be a big boss someday.”

    American father says, “son you need to tell the teacher you lied and apologize.”

    In addition to cheating each other. Chinese people love cheating foreigners. Business in China is an adverserial relationship at best. And it is hostile. Chinese supplier goal is to get as much as the can from the buyer using all means necessary including cheating and lying. This is good Chinese business from the Chinese perspective. Contracts are broken routinely and during production process corners are cut effecting quality. Common scheme; establish trust and slowly start the cheating games.

    I personally have had factory owners, government officials, bank presidents and countless other Chinese people lie right to me face in person on so many occasions it is ridiculous. Just lying and smiling away. And no this is not face. Becuase face is given as a sign of respect.

    Why?

    I don’t know probably becuase the whole system is built on lies. Also, Chinese seem to feel that they are superior to everyone and that they must do things the Chinese way.

    Well the Chinese way is a sure way to be cheated fast. And having considerable experience in China; I sincerely hope that you do your best to prepare students about lying, cheating & greed of China.

  6. Chris Carr says:

    James,

    Thanks for checking in.

    We try not to tell graduate students what they need to believe about the Chinese or other. If you came on our trip, you would see that they are exposed to the many different facets and people of China, including the bogeyman you allude to, and they are big boys and girls and they then decide for themselves. Same re the videos and readings they are exposed to before we leave on the trip. Let’s you and me get out of the way and let them learn as adults should.

    The examples you cite in China I have also seen, over and over, here in the US. I know some American fathers who show their sons/daughters how to cheat by what they say and do. I know some American mothers who do the same darn thing. I have seen American kids teach each other how to cheat.

    I repeat what I earlier noted …. please provide me with a definition of cheating we can all reasonably agree on (e.g., if/when one pushes the limits on their tax return, is that ‘cheating’?; when one charges more to one customer versus another is that unethical or ‘cheating’?, etc.), and provide me with actual data with a decent sample size to support said definition and test a cheating hypothesis; sample sizes of two or three person’s or firm’s anecdotal life experience makes for an interesting war story to tell to a class of students, but not much more than that.

    For every expat in China or American in the US doing business in China that I have met over the years who say the Chinese are bad, I have met an equal number that say the opposite. So go figure.

    I have also met a number of such business people that say and believe if one is cheated in China (or anywhere in the world), they have only themselves to blame because chances are they did little, if any, due diligence and their expectations were far out of whack with reality for that market.

    And here is the rub that I can never quite figure out with the “I just know for a fact that Chinese are bigger cheaters than the rest of the world” crowd …

    A number of them do business in China and make good money. And/or, they buy Chinese made goods because they are addicted to the cheap price. I.e., they are doing business with these alleged bad boys and/or buy their product, so how is it they can so cleanly separate ‘us’ from ‘them’?

    I also have noticed that such folks rarely put their names on the blog comments they make. I have learned over the years not to put much stock in a statement that a person makes from the hidden shadows. The way we find ‘truth’ is on such matters is to shed full and complete sunlight on them, and that includes statements, who makes them, and the context in which they make them.

    For example, the Wall Street Journal, and other decent papers, never publish an op-ed piece anonymously.

    I see no reason why blog land should be any different, particularly here in the US, because nobody here is at risk of going to jail for such comments, so why not make the statement, identify the author, and let the chips fall where they may?

  7. Christine says:

    James and Corey,

    Honestly, I don’t know where to begin. Part of me would love to continue a debate as to whether Chinese people such as myself “lie, cheat and steal.”

    Oh wait, my assumption is going to be that you meant to say Mainland Chinese right? Or do you mean all Chinese? Including those from Hong Kong, Taiwan and Singapore? …or perhaps you may make an exception for my type of Chinese since I grew up in the U.S. — In which case, it’d be a bit difficult to say all Chinese wouldn’t it?

    While I can understand and even relate to the issues you’ve faced while doing business in China, with all due respect, it doesn’t qualify you to make assumptions of an entire culture based on your limited experience in your limited number of years there and your limited industry.

    I made just as many local Chinese friends during my years living/working in China as I did expats. Thankfully, they know better than to say that all Americans are arrogant, self centered, condescending jerks when they see and hear of examples of typical ignorant loud mouthed Westerners staggering out of expat bars drunk with 2 Chinese girls half their age hanging onto each of their arms and cursing at the taxi driver for not understanding their foul mouthed slurred attempt at directions back to his apartment.

    Its such attitudes about doing business in China that continue to be perpetuated outside of China. Most often by people who have little knowledge, understanding or concern about Chinese culture to begin with.

    Now if you’ll excuse me, I need to warn my American husband that all these years of building trust with him is about to transition into cheating game mode. I’m sorry, I can’t help it as by your assumptions, my being Chinese predisposes me to this type of behavior and it’s just a matter of time.

    Thank you for pointing this out to all of us. Please feel free to email me as I’d be very interested in continuing this dialog on-air on a future segment of my show.

    Best regards,
    Christine
    The China Business Network

  8. Chris Carr says:

    Christine,

    Thanks for checking in.

    You nicely put into words what I have struggled with for years to explain to young American students who study China, its history and culture. Well said.

  9. Simeon says:

    As an ABC (American Born Chinese), I was a little uncomfortable with the stereotypes in this article. I understand that it’s one opinion based on an experience of one individual, but like any generalization, and Christine put this into words well, we cannot make assumptions of a culture based upon a limited scope of understanding. It is interesting to note, that while Americans view Chinese as “not to be trusted, liars”, the Chinese actually have similar stereotypes about Americans: “open, speak their minds, but not honestly from the heart”. There may be a dash of truth in a stereotype, but they must never be used in preconceptions of a culture’s character as a whole, Chinese, American or any other culture. Thanks to everyone for your thought provoking posts.

  10. Lonnie says:

    How ethnocentric and narrow to blame one’s misfortunes on ethnic differences….

    I too have worked in Asia for more than 20 years of my life. I find the manner in which business is carried out to be remarkably different, but the elements of “the deal” to be essentially the same. That you allowed yourself to be taken advantage of in a business transaction is more likely due to your own business inadequacies and not the gender based morality you assume created it…

    You would likely have been taken to the cleaners far more efficiently in the west.

    Much about business in Asia is implied or tacit and it is an expectation that you know and understand the cultural rules and behaviors that accompany transactions and even ordinary day-to-day relationships….Shopkeepers, colleagues, students and neighbors treat me with the dignity and respect accorded a resident because I have chosen acculturation above supposition and ignorance…I have been cheated by taxi divers in strange cities world-wide, and I have met businessmen who were evil incarnate on 5 continents…China has no monopoly on greed, ambition or self-serving behavior….

    Your lack of respect for the system that feeds and clothes you is likely part-and-parcel of your inability to succeed without calamity…

  11. Hi Corey and James,

    I too have been living in China, and can understand some of what you talk about. In China (as everywhere else), you must be a shrewd business person or people will try to cheat you. In China (as everywhere else), there are plenty of people who will be happy to cheat you out of as much as money as they can. In China (as everywhere else), you should do business on your terms as much as possible, if not always. And in China (as everywhere else), business is business.

    Does the word racist mean anything to you two?

    There are lots of stories like one posted here:
    http://www.chinasnippets.com/2006/03/03/chinese-business-scams-china-fever/

    And they are, for some reason, seen as typical. But let’s not forget one thing that is ever-present in this scam. Is it wrong for the Chinese folks here to scam these poor innocent Westerners out of their hard-earned money?

    These Westerners, like so many who succumb to China and who suffer from scams in the middle kingdom, are victims of their own greed. This deal described is too good to be true for most, and it is their own avarice, not a racial predilection for cheating, that causes this company to lose its shirt in China.

    What bothers me so much is that someone, including our own Corey and James, might imagine these Westerners are innocent of the tricks that these Chinese are playing on them, and that they are being faced with some kind of deceitful treachery that is based solely on the color of Chinese skin. There is some kind of white innocence at the heart of this story: some kind of naivety that suggests that despite their refusal to do due diligence on this country or company, their willingness to take the bait of a “big” company in China, and their ease in believing that this company is going to work with a company they have known for only a matter of days in simple foolishness. For Corey and James, it seems there is some kind of white ethically naive innocence confronting a yellow peril of lying, cheating, stealing Chinese. It is this racism that bothers me. The racism fueled here by the yellow threat of Chinese cheating is akin to the blatant “yellow peril” racism of 1800s America and should be treated as such.

    I, like Chris, find your refusal to leave an identity here putting your credibility at a low ebb.

    I, like Chris, agree that without some kind of meaningful, quanitifiable definition of cheating, this discussion is pointless. Otherwise, the word is a loaded word charged with psychology and with a bitter stereotype about Chinese people that only has roots in anecdotal stories about China.

  12. Simeon says:

    “Before I open this can of worms, let me make clear from that outset that I am not the “source” of this perception. Nor do I believe it. I merely report what the perception by some is as I have heard it over and over from a number of people. So don’t shoot the messenger.”

    Please note that author of the article, quoted above, did mention that this was not his personal view. It is the view of others that he has observed. Just a reminder to any future bloggers. :>

  13. Mark Wegemer says:

    Christine above makes a nice addition to the posts talking about said limited knowledge about dealing with said limited people in China. I agree with what she has shown that a mindset should be formed about those that you have dealt with. You cannot make slanderous accusations about a certain race or religion. These are the kind of accusations that have caused trouble throughout history; races blaming other races for ignorance. It’s pathetic to say the least but it happens to everyday life here in the United States.
    Now that we are on accusations and equality, the United States of American has recently elected a said African American President. People are already labeling him as African American and I don’t think its right to do so. He is the next United States president but labeling him as African American shows the need for the United States to label everything. Equality is far from being equality. For China, for the world, there will always be labels for everything made by everyone. It is a shame that it has become this way.

  14. Andrew says:

    In my experiences, in China and in Canada, I have been lied to and cheated by people or companies in both places. However, in China it is more probable that you will be cheated or lied to. Not because they are Chinese, but because of the culture here and what their beliefs are and what is acceptable here.
    I have been cheated once in Canada in my 12 years of working there. In China I have been partially cheated maybe 3 times, attempts to cheat me from every employer I have worked for. And lied to directly quite regularly to some level. It doesn’t matter if you are a good person, friendly, and great business and work ethic. it will come your way, it’s just the nature of the beast here. Sure, it happens in the west often too, but not even close to as much, and in most western countries we have laws to protect people from these things from happening. Contracts mean nothing in China to even the companies who wrote them out. I am not racist at all, and I like to defend the people of this country any time I can, however, let’s not be ignorant, let’s not beat around the bush, and let’s just accept reality, most people who have spent time in both countries know this, including Chinese.

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