In this incisive analysis of one of the most spectacular economic breakthroughs in the Deng era, Jean C. Oi shows how and why Chinese rural-based industry has become the fastest growing economic sector not just in China but in the world. Oi argues that decollectivization and fiscal decentralization provided party officials of the localities—counties, townships, and villages—with the incentives to act as entrepreneurs and to promote rural industrialization in many areas of the Chinese countryside. As a result, the corporatism practiced by local officials has become effective enough to challenge the centrality of the national state.
Dealing not only with the political setting of rural industrial development, Oi's original and strongly argued study also makes a broader contribution to conceptualizations of corporatism in political theory. Oi writes provocatively about property rights and principal-agent relationships and shows the complex financial incentives that underpin and strengthen the growth in local state corporatism and shape its evolution. This book will be essential for those interested in Chinese politics, comparative politics, and communist and post-communist systems.
Rural China Takes Off Institutional Foundations of Economic Reform
About the Book
Reviews
"A distinctive and important contribution."—Thomas P. Bernstein, author of Up to the Mountains and Down to the VillagesTable of Contents
List of Illustrations and Tables
Acknowledgments
Note on Measures and Transliteration
1. Institutional Foundations of Chinese
Economic Growth: An Introduction
State and Development
A Problem of Agency
Property Rights and Economic Growth
Local State Corporatism
Institutional Reform, Incentives, and Change
Precis of the Study
2. Reassigning Property Rights over Revenue: Incentives for Rural Industrialization
Dividing Property Rights
Decollectivization and the Loss of Income
Fiscal Reform and Rights to the Residual
Credible Commitment
From Limited Indirect Extractions to Direct Taxation
Fiscal Incentives for Local Development
3. Strategies of Development: Variation and Evolution in Rural Industry
Intervening Incentives
The Character of Rural Industrial Growth in the 1980s
The Logic of Collectively Owned Enterprise Development
Management and Ownership in the 1990s
Changing Ownership Forms in Rural Industry
4. Local State Corporatism: The Organization of Rapid Economic Growth
Maoist Legacy as the Foundation
The Local Corporate State
Adapting Maoist Institutions to Market Production
Adapting Local State Corporatism to Private Enterprise
The Evolution of Local State-Led Development
5. Principals and Agents: Central Regulation or Local Control
Overlapping Lines of Authority
The Corporate Nature of Local Regulation
Local Appropriation of Central Controls
6. From Agents to Principals: Increasing
Resource Endowments and Local Control
Regulation of Extra budgetary Funds
Economic Retrenchment and a Test of Central Control
The Erosion of Credit Controls
Local Corporate Interests and Collusion
Nonbank Sources of Capital
The Limits of Central Control in a Changing Economic Context
7. The Political Basis for Economic Reform: Concluding Reflections
The Security of Property Rights and Economic Growth
The Political Consequences of Economic Reform
Local State Corporatism and Central Control in a Transitional System
Remaining Questions
Appendix A. Research and Documentation
The Interview Sample
The Interview Procedure
Limitations
Appendix B. Changes in China's Fiscal System
Bibliography
Index
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