Economic Freedom and Political Control in Post-Mao China: A Perspective of Upward Accountability and Asymmetric Decentralization

Abstract

With post-Mao China as a case study, this article aims to examine the political economy of asymmetric decentralization in relation to development at the national, regional (inter-local) and local levels. Economically, sub-national governments have been granted greater autonomy with huge decentralized fiscal and administrative powers and competencies. Politically, however, China is still a state under Communist Party domination. Local officials are not elected locally but are assigned by the party. This phenomenon of ‘economic decentralization to the local’ along with ‘political centralization under the party’ is described as ‘asymmetric decentralization’. The mechanism behind asymmetric decentralization is upward accountability—the greater the economic growth, the better chances there are for local leaders to receive political promotions, administrative power and many tangible and intangible perks. The article further discusses six Janus-faced consequences of asymmetric decentralization, which can be grouped into three pairs of administrative levels: (1) at the national level—positive for relative national economic stability but negative for uneven development across the country; (2) at the regional (inter-local) level—bad for inter-local fragmentation but good for cross-regional cadre transfer; and (3) at the local level—where local policy innovation is a strength but local unsustainable development is a weakness. These consequences, which look contradictory or incompatible on the surface, can be better understood through the analytic framework of ‘asymmetric decentralization with upward accountability’.