Business associations in China: Two regional experiences

Abstract

This article compares different practices of business associations in two localities in China – Wuxi and Wenzhou – and examines the internal linkage between associational practices and patterns of economic development. In Wuxi, business associations are organised and run by government in a top-down approach, and serve as state corporatist instruments; while in Wenzhou, there emerged many grass-roots business associations initiated and governed by entrepreneurs from bottom-up, working for societal purposes. The distinctive associational practices in the two localities are linked with their local economic development patterns: government-led development in Wuxi versus entrepreneur-initiated development in Wenzhou. The article concludes that the growth of private entrepreneurship and the spread of market relations, together with the willingness of government to leave space to societal actors, are the primary conditions for autonomous, vibrant business associations to occur.