Enlightened Localism in Contemporary China: Political Change in Property-Rights Institutions of Township and Village Enterprises

Abstract

AbstractI examine the dynamic and interactive relationships between local governments and local economic elites as they attempted to privatize China’s township and village enterprises (TVEs) in the late 1990s. To pursue financial interests shared with the local economic elite, local governments informally privatized public TVEs and thereby compromised their role as political agents of the central government. This institutional change in property rights demonstrates a Chinese pattern of “enlightened localism” (Gregg 2003) by which the local political and economic actors develop a pragmatic way of coping with ambiguous legal issues. The deployment of enlightened localism in the TVE sector shows that China’s policies of economic decentralization unintentionally have led to a decentralization of political control.