Abstract
The Confucian school emphasizes family value, moral persuasions, and personal relations. Under Confucianism, there is a free-rider issue in the provision of efforts. Since national officials are chosen through personal relations, they may not be the most capable. The Legalist school emphasizes the usage of incentives and formal institutions. Under the Legalism, the ruler provides strong incentives to local officials which may lead to side effects because some activities are noncontractible. The cold-blood image of the Legalism may alien citizens. By exploiting the paternalistic relationship between the ruler and the ruled under Confucianism and the strength of institution-building under the Legalism, the ruler may benefit from a combination of Confucianism approach and the Legalism approach as the national strategy of governance. As each strategy has its pros and cons, which strategy of is optimal depends on factors such as the minimum enforceable level of public service and the level of institution building costs.
Similar content being viewed by others
References
Chao K (1986). Man and Land in Chinese History: An Economic Analysis. Stanford, CA: Stanford University Press
Elster J (1989). Social norms and economic theory. Journal of Economic Perspectives, 3(4): 99–117
Elvin M (1973). The Pattern of the Chinese Past: A Social and Economic Interpretation. Stanford, CA: Stanford University Press
Fang H (2001). Social culture and economic performance. American Economic Review, 91: 924–937
Gu Hongming (辜鸿铭) (2010, originally published in 1915). The Spirit of the Chinese People (中国人的精神). Shanghai (上海): Sanlian Publishing House (三联书店)
Holmstrom B, Milgrom P (1991). Multi-task principal-agent analyses: incentive contracts, asset ownership, and job design. Journal of Law, Economics, & Organization 7: 24–52
Huang R (1974). Taxation and Governmental Finance in Sixteen-Century Ming China. Cambridge, UK: Cambridge University Press
Huang R (1982). 1587, A Year of No Significance: The Ming Dynasty in Decline. New Haven, CT: Yale University Press
Huang R (1997). China: A Macro History. Turn of the century edition. Armonk, NY: M. E. Sharpe, Inc.
Huang R (1999). Broadening the Horizons of Chinese History: Discourses, Syntheses, and Comparisons. Armonk, NY: M. E. Sharpe, Inc.
Lazear E (1989). Pay equality and industrial politics. Journal of Political Economy, 97: 561–580
Lin J Y (1995). The Needham puzzle: Why the Industrial Revolution did not originate in China? Economic Development and Cultural Change, 43: 269–292
Lü S (吕思勉) (2011, originally published in 1940 and 1944). General History of China (中国通史). Nanjing (南京): Phoenix Publishing House (风凰出版社)
Pomeranz K (2000). The Great Divergence: China, Europe, and the Making of the Modern World Economy. Princeton, NJ: Princeton University Press
Qian Mu (钱穆) (2001, originally published in 1952). The Successes and Failures of Politics in Different Periods of China (中国历代政治得失). Beijing (北京): Sanlian Publishing House (三联书店)
Rosenthal J-L, Wong R B (2011). Before and Beyond Divergence: The Politics of Economic Change in China and Europe. Cambridge, MA: Harvard University Press
Shiue C (2004). Local granaries and central government disaster relief: moral hazard and intergovernmental finance in 18th and 19th century China. Journal of Economic History, 64: 101–125
Shiue C (2005). The Political Economy of famine relief in China, 1740–1820. Journal of Interdisciplinary History, 36: 33–55
Shiue C, Keller W (2007). Markets in China and Europe on the eve of the industrial revolution. American Economic Review, 97: 1189–216
Topkis D (1998). Supermodularity and Complementarity. Princeton, NJ: Princeton University Press
Waley A (1982 originally published in 1939). Three Ways of Thought in Ancient China. Stanford, CA: Stanford University Press
Wong R B (1997). China Transformed: Historical Change and the Limits of European Experience. Ithaca, NY: Cornell University Press
Zhou H (2004). The division of labor and the extent of the market. Economic Theory, 24: 195–209
Zhou H (2009). Population growth and industrialization. Economic Inquiry, 47: 249–265
Zhou H (2012). Internal rebellions and external threats: a model of the government organizational form in ancient China. Forthcoming at Southern Economic Journal
Author information
Authors and Affiliations
Corresponding author
About this article
Cite this article
Zhou, H. Confucianism and the Legalism: A model of the national strategy of governance in ancient China. Front. Econ. China 6, 616–637 (2011). https://doi.org/10.1007/s11459-011-0150-4
Received:
Published:
Issue Date:
DOI: https://doi.org/10.1007/s11459-011-0150-4