Abstract
The introductory chapter first defines the major question to be addressed by the book, that is, the so-called fundamental state-market dilemma, and then briefly describes existing solutions and their merits and weaknesses in overcoming the state-market dilemma. After that, the chapter presents the book’s major argument: dual intergovernmental transformation for market development (DITMD). Finally, the chapter discusses the comparability of the two cases of China and United States and describes the organization of the book as well.
This is a preview of subscription content, log in via an institution to check access.
Access this chapter
Tax calculation will be finalised at checkout
Purchases are for personal use only
Notes
- 1.
About this subject, see a recent comprehensive review by Pranab Bardhan (2016).
- 2.
Most studies of decentralization do not express explicitly whether the state as a whole shall be strong or weak. But, the literature of decentralization implies implicitly that the state shall have strong authority over markets.
- 3.
But, of course, the helping-hand state is different from socialism. One profound distinction between these two is that while the proponent of the helping hand of the state holds a philosophy of “the state plus markets,” socialism in principle does not acknowledge the fundamental virtue of markets.
References
Acemoglu, Daron, & James A. Robinson, Why Nations Fail: The Origins of Power, Prosperity, and Poverty, New York: Crown Business, 2012.
Aghion, Philippe, & Alexandra Roulet, “Growth and the Smart State,” Annual Review of Economics, Vol. 6, 2014, pp. 913–926.
Alchian, Armen A., “Property Rights,” in David R. Henderson ed., The Concise Encyclopedia of Economics, Liberty Fund, 2008, online available at http://www.econlib.org/library/Enc/PropertyRights.html
Bardhan, Pranab, “The Nature of Institutional Impediments to Economic Development,” Center for International and Development Economics Research Working Paper No. C96-066, “Decentralization of Governance and Development,” Journal of Economic Perspectives, Vol. 16, No. 4, 2002, pp. 185–205.
Bardhan, Pranab, “State and Development: The Need for a Reappraisal of the Current Literature,” Journal of Economic Literature, 2016, No. 54, Vol. 3, pp. 862–892.
Barzel, Yoram, A Theory of the State: Economic Rights, Legal Rights, and the Scope of the State, New York: Cambridge University Press, 2002.
Cao, Yuanzheng, Yingyi Qian, & Barry R. Weingast, “From Federalism, Chinese Style, to Privatization, Chinese Style,” Economics of Transition, Vol. 7, No. 1, 1999, pp. 103–131.
Cheema, G. Shabbir, & Dennis A. Rondinelli eds., Decentralizing Governance: Emerging Concepts and Practices, Washington, D.C.: Brookings Institute Press, 2007.
Chen, Minglu, & David S. G. Goodman, “The China Model: One Country, Six Authors,” Journal of Contemporary China, Vol. 21, Issue 73, 2012, pp. 169–185.
Clarke, Donald C., “Economic Development and the Rights Hypothesis: The China Problem,” American Journal of Comparative Law, Vol. 51, No. 1, 2003, pp. 89–111.
Coase, Ronald H., “The Nature of the Firm,” Economica, Vol. 4, No. 16, 1937, pp. 386–405.
Coase, Ronald H., “The Problem of Social Cost,” Journal of Law and Economics, Vol. 3, 1960, pp. 1–44.
Coase, Ronald H., & Ning Wang, How China Became Capitalist, New York: Palgrave Macmillan, 2012.
Davies, Howard, Thomas K. P. Leung, Sherriff T. K. Luk, & Yiu-Hing Wong, “The Benefits of ‘Guanxi’: The Value of Relationships in Developing the Chinese Market,” Industrial Marketing Management, Vol. 24, Issue 3, 1995, pp. 207–214.
Davis, E. Lance, & Douglass C. North, Institutional Change and American Economic Growth, New York: Cambridge University Press, 1971.
Demsetz, Harold, “Toward a Theory of Property Rights,” The American Economic Review, Vol. 57, No. 2, “Property Rights,” in Peter Newman ed., The New Palgrave Dictionary of Economics and the Law, Vol. 3, Hants: Palgrave Macmillan, 2002, pp. 144–155.
Erk, Jan, “Comparative Federalism as a Growth Industry,” Publius: The Journal of Federalism, Vol. 37, Issue 2, 2007, pp. 262–278.
Faguet, Jean-Paul, “Decentralization and Governance,” World Development, Vol. 53, 2014, pp. 2–13.
Fukuyama, Francis, State-Building: Governance and World Order in the 21st century, Ithaca, N.Y.: Cornell University Press, 2004.
Fukuyama, Francis, The Origins of Political Order: From Prehuman Times to the French Revolution, FSG, 2011.
Fukuyama, Francis, Political Order and Political Decay: From the Industrial Revolution to the Globalization of Democracy, FSG, 2014.
Greif, Anver, Institutions and the Path to the Modern Economy: Lessons from Medieval Trade, New York: Cambridge University Press, 2006.
Hamilton, Alexander, John Jay, & James Madison, The Federalist: A Commentary on the Constitution of the United States, edited and with an introduction by Robert Scigliano, New York: Modern Library, 2001.
Jin, Hehui, Yingyi Qian, & Barry R. Weingast, “Regional Decentralization and Fiscal Incentives: Federalism, Chinese Style,” Journal of Public Economics, Vol. 89, 2005, pp. 1719–1742.
Kennedy, David, & Joseph E. Stiglitz eds., Law and Economics with Chinese Characteristics: Institutions for Promoting Development in the Twenty-First Century, University of Oxford Press, 2013.
Levi, Margaret, “The Predatory Theory of Rule,” Politics and Society, Vol. 10, 1981, pp. 431–465.
Lin, Justin Yifu, “New Structural Economics: A Framework for Rethinking Development,” The World Bank Research Observer, Vol. 26, No. 2, 2011, pp. 193–221.
Mao, Zedong, “On the Ten Major Relationships,” in Mao Zedong, Selected Works of Mao Zedong, 1999, Beijing: People’s Publishing House, pp. 23–49.
Menard, Claude, & Mary M. Shirley eds., Handbook of New Institutional Economics, Boston, MA: Springer, 2005.
Montinola, Gabriella, Yingyi Qian, & Barry R. Weingast, “Federalism, Chinese Style: The Political Basis for Economic Success in China,” World Politics, Vol. 48, No. 1, 1995, pp. 50–81.
North, Douglas C., Structure and Change in Economic History, New York: Norton, 1981.
North, Douglas C., “Government and the Cost of Exchange in History,” Journal of Economic History, Vol. 44, No. 2, 1984, pp. 255–264.
North, Douglas C., Structure and Change in Economic History, New York: Norton, Institutions, Institutional Change, and Economic Performance, New York: Cambridge University Press, 1990.
Oates, Wallace E., Fiscal Federalism, New York: Harcourt Brace Jovanovich, “An Essay on Fiscal Federalism,” Journal of Economic Literature, Vol. 37, No. 3, (Sep., 1999), pp. 1120–1149.
Oi, Jean C., & Andrew G. Walder eds., Property Rights and Economic Reform in China, Stanford, Calif.: Stanford University Press, 1999.
Olson, Mancur, “Dictatorship, Democracy, and Development,” American Political Science Review, Vol. 87, No. 3, 1993, pp. 567–576.
Ong, Lynette H., “Fiscal Federalism and Soft Budget Constraints: The Case of China,” International Political Science Review, Vol. 33, No. 4, 2012, pp. 455–474.
Pan, Wei ed., China Model: A New Development Model from the Sixty Years of the People’s Republic (《中国模式:解读人民共和国的60年》), Beijing: Central Compilation & Translation Press, 2009.
Qian, Yingyi, & Barry R. Weingast, “China’s Transition to Markets: Market-Preserving Federalism, Chinese Style,” Journal of Economic Policy Reform, Vol. 1, Issue 2, 1996, pp. 149–185.
Qian, Yingyi, & Barry R. Weingast, “Federalism as a Commitment to Preserving Market Incentives,” Journal of Economic Perspectives, Vol. 11, No. 4, 1997, pp. 83–92.
Rodden, Jonathan, “Comparative Federalism and Decentralization: On Meaning and Measurement,” Comparative Politics, Vol. 36, No. 4, 2004, pp. 481–500.
Rodden, Jonathan, Hamilton’s Paradox: The Promise and Peril of Fiscal Decentralization, New York: Cambridge University Press, 2006.
Rodden, Jonathan, & Susan Rose-Ackerman, “Does Federalism Preserve Markets?” Virginia Law Review, Vol. 83, No. 7, Symposium: The Allocation of Government Authority, 1997, pp. 1521–1572.
Rondinelli, Dennis A., “Government Decentralization in Comparative Perspective: Theory and Practice in Developing Countries,” International Review of Administrative Sciences, Vol. 47, No. 1, 1981, pp. 133–145.
Shleifer, Andrei, & Robert W. Vishny, “Corruption,” The Quarterly Journal of Economics, Vol. 108, No. 3, The Grabbing Hand: Government Pathologies and Their Cures, Cambridge, MA: Harvard University Press, 1998.
Stiglitz, Joseph E., The Economic Role of the State, Cambridge, MA: B. Blackwell, 1989.
Stiglitz, Joseph E., “The Role of Government in Economic Development,” Annual World Bank Conference on Development Economics, 1996.
Stiglitz, Joseph E., “More Instruments and Broader Goals: Moving Toward the Post-Washington Consensus,” The 1998 WIDER Annual Lecture, Helsinki, Finland, 1998.
Stiglitz, Joseph E., & Shahid Yusuf eds., Rethinking the East Asia Miracle, New York: Oxford University Press, 2001.
Trebilock, Michael, & Jing Leng, “The Role of Formal Contract Law and Enforcement in Economic Development,” Virginia Law Review, Vol. 92, 2006, pp. 1517–1580.
Treisman, Daniel, The Architecture of Government: Rethinking Political Decentralization, New York: Cambridge University Press, 2007.
Wan, Ming, The China Model and Global Political Economy: Comparison, Impact, and Interaction, Abingdon, Oxon: Routledge, 2014.
Weingast, Barry R., “The Economic Role of Political Institutions: Market-Preserving Federalism and Economic Development,” Journal of Law, Economics, & Organization, Vol. 11, No. 1, 1995, pp. 1–31.
Weingast, Barry R., “Second Generation Fiscal Federalism: The Implications of Fiscal Incentives,” Journal of Urban Economics, Vol. 65, Issue 3, 2009, pp. 279–293.
Wibbels, Erik, Federalism and the Market: Intergovernmental Conflict and Economic Reform in the Developing World, New York: Cambridge University Press, 2005.
Williamson, John, “What Washington Means by Policy Reform,” in John Williamson ed., Latin American Adjustment: How Much Has Happened, Washington, D.C.: Institute for International Economics, 1990.
Williamson, Oliver E., “Economies as an Antitrust Defense: The Welfare Tradeoffs,” The American Economic Review, Vol. 58, No. 1, “Transaction-Cost Economics: The Governance of Contractual Relations,” Journal of Law and Economics, Vol. 22, No. 2, 1979, pp. 233–261.
Williamson, Oliver E., The Economic Institutions of Capitalism: Firms, Markets, Relational Contracting, New York: Free Press, 1985.
Williamson, Oliver E., The Mechanisms of Governance, New York: Oxford University, 1996.
The World Bank, World Development Report 1997: The State in A Changing World, New York: Oxford University Press, 1997.
The World Bank, World Development Report, World Development Report 2002: Building Institutions for Markets, New York: Oxford University Press, 2002.
World Bank Independent Evaluation Group, Decentralization in Client Countries: An Evaluation of World Bank Support, 1990–2007, Washington, D.C.: World Bank, 2008.
Wunsch, James S., “Decentralization: Theoretical, Conceptual, and Analytical Issues,” in J. Tyler Dickovick & James S. Wunsch ed., Decentralization in Africa: The Paradox of State Strength, Boulder, CO: Lynne Rienner Publishers, 2014, pp. 1–22.
Zhao, Qizheng, John Naisbitt, & Doris Naisbitt, Dialogue the China Model (《对话中国模式》), Beijing: New World Press, 2010.
Author information
Authors and Affiliations
Copyright information
© 2019 The Author(s)
About this chapter
Cite this chapter
Cheng, J. (2019). Introduction. In: States, Intergovernmental Relations, and Market Development. Governing China in the 21st Century. Palgrave Macmillan, New York. https://doi.org/10.1057/978-1-137-58357-4_1
Download citation
DOI: https://doi.org/10.1057/978-1-137-58357-4_1
Publisher Name: Palgrave Macmillan, New York
Print ISBN: 978-1-137-59091-6
Online ISBN: 978-1-137-58357-4
eBook Packages: Political Science and International StudiesPolitical Science and International Studies (R0)