Comments by Ding Lu, on Zombie Firms and the Crowding-Out of Private Investment in China

Abstract

October 01 2016 Comments by Ding Lu, on Zombie Firms and the Crowding-Out of Private Investment in China Author and Article Information Online Issn: 1536-0083 Print Issn: 1535-3516 © 2016 by the Earth Institute at Columbia University and the Massachusetts Institute of Technology2016Massachusetts Institute of Technology Asian Economic Papers (2016) 15 (3): 56–57. https://doi.org/10.1162/ASEP_a_00475 Cite Icon Cite Permissions Share Icon Share Facebook Twitter LinkedIn MailTo Views Icon Views Article contents Figures & tables Video Audio Supplementary Data Peer Review Search Site Citation Comments by Ding Lu, on Zombie Firms and the Crowding-Out of Private Investment in China. Asian Economic Papers 2016; 15 (3): 56–57. doi: https://doi.org/10.1162/ASEP_a_00475 Download citation file: Ris (Zotero) Reference Manager EasyBib Bookends Mendeley Papers EndNote RefWorks BibTex toolbar search Search Dropdown Menu toolbar search search input Search input auto suggest filter your search All ContentAll JournalsAsian Economic Papers Search Advanced Search Ding Lu: This paper scrutinizes the effects of state-led investment on economic efficiency in China at the microeconomic level. Since the early 1980s, China has achieved extraordinary success in economic development. A crucial feature of this developmental path is a proactive role played by the government. As observed by Lin (2012, 2013), while pursuing reforms to build a well-functioning market economy, the Chinese government has facilitated the development and upgrading of industries according to the economy's dynamic comparative advantages over years. The key elements of the government's proactive role include: (a) compensating for externalities created by pioneer firms in the process of industrial upgrading; (b) coordinating the desirable investments and improvements in soft and hard infrastructure; and (c) liberalizing entry into sectors in which the country has comparative advantages but at the same time providing some transitory supports and protections to unviable firms to maintain (social) stability.... You do not currently have access to this content.