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This study examines institutional survival under conditions of extreme state repression. We argue that institutional values under these onditions become dormant in small “safe” social spaces such as families and small close-knit social groups. As state repression becomes increasingly violent, the suppressed groups within those spaces become more resilient in preserving “deviant” values and mitigating the negative long-term impact of state violence on institutional revival. We examine the extent to which pre-1949 entrepreneurial families served as institutional carriers for private entrepreneurship in the Mao era (1949-1978) of China, especially in the context of the political violence of the Cultural Revolution (1966-1976), and shaped individuals’ entry into private entrepreneurship in the post-1978 reform era. We find that entrepreneurial transmission was suppressed at the family level by communist repression. Where more severe political violence occurred, pre-1949 entrepreneurial families could better mitigate the deterrent effect on institutional revival of the number of deaths that occurred locally during the Cultural Revolution. Stigmatized pre-1949 entrepreneurial families—those with “bad” class origins—mitigated the effects better than their nonstigmatized counterparts. We test to control for public sector job opportunities at the individual and municipal levels and find that these opportunities are unlikely to drive our results.

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