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Many scholars attribute China’s remarkable economic performance since
留学生论文网1978 in part to the country’s political and fiscal decentralization. Politicaldecentralization is said to have stimulated local policy experiments andrestrained predatory central interventions. Fiscal decentralization is thoughtto have motivated local officials to promote development and hardenenterprises’ budget constraints. The locally diversified structure of the prereformeconomy is said to have facilitated liberalization. We examine thesearguments and find that none establishes a convincing link between
decentralization and China’s successes. We suggest an alternative view of thereform process, in which growth-enhancing policies emerged from
competition between pro- and anti-market factions in Beijing.
a Department of Economics, University of California, Los Angeles
b Department of Political Science, University of California, Los Angeles, 4289 Bunche
Hall, Los Angeles CA 90095-1472.
1 Introduction
What roles have political and fiscal decentralization played in China’s economic reforms and in
the remarkable boom they fostered? Since the late 1970s, China has liberalized most prices, decollectivized
agriculture, and integrated into world markets. These changes fueled an
unprecedented period of growth, with GDP per capita rising from $674 in 1978 to $5,085 in 2004
(in PPP-adjusted 2000 dollars).1 Scholars have attributed this economic miracle to many causes—recovery from the Cultural Revolution, initial underdevelopment, and a rich diaspora, to name afew. But some suggest the country’s decentralized structures of government and public finance
played an important part.2Those who credit the success of China’s reforms in part to decentralization make five
main arguments. First, some focus on the pre-reform economy’s modular organization. Ratherthan a specialized, nationwide hierarchy, China’s economy consisted of parallel, diversified
provincial economies. This reduced dislocations and stimulated competition when markets were
introduced. Second, some believe political decentralization encouraged local reform experiments,
allowing new ideas to percolate up from the grass roots. Third, some argue decentralization
created political checks on the central authorities, limiting predation and convincing investors
reforms would last. Fourth, some suggest fiscal decentralization gave local officials strong
1 Based on the International Comparison Program, as reported in the World Bank’s World Development
Indicators Database. In non-PPP adjusted 2000 US dollars, the increase was from $153 to $1,162.
2 For instance, Qian and Weingast (1996) assert that: “The critical component of China’s market-oriented
reform, which began in 1979, is decentralization.” Montinola et al. (1996) label China’s political system
during the reform era one of “market-preserving federalism,” and suggest this had various economic
benefits. Qian and Roland (1998, p.1156) argue that: “one of the most distinct features of China’s transition
has been associated with devolution of authority from the central to local levels of government.” For other
articles that link the success of economic reforms to political decentralization, see Chen (1993) and Xu and
Zhuang (1998). Adherents of this view often note that decentraliza本论文由英语论文网提供整理，提供论文代写，英语论文代写，代写论文，代写英语论文，代写留学生论文，代写英文论文，留学生论文代写相关核心关键词搜索。