Path dependence in the evolution of resort governance models in China

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Governance models have attracted growing academic interest in the recent literature on resort development. In transitional China, resort governance models have been evolving in step with the country's marketization and modernization. This paper reports on a case study of the governance models relating to the Yalong Bay National Tourist Resort (YBNTR), one of China's most famous resort destinations. Two approaches to data collection were used in this study: secondary data from local governmental agencies and companies, and in-depth interviews with 18 key personnel involved with the resort. This study, by reviewing the evolution of YBNTR governance models, shows that a path-dependence context impacted on its evolution. By integrating the ‘road juncture’ approach to understanding path dependence with elements of Institutional Costs Theory, a proposition for the formative mechanism of path dependence in the evolution of the YBNTR governance model was formulated and tested. It is demonstrated that, at the key time junctures for decisions on YBNTR governance models, influential actors (e.g. local government, the developers, and nearby communities) were theoretically provided with multiple choices. However, the existence of institutional costs structured the potential options of the actors in two ways: on the one hand, the opportunity costs of giving up the previous governance model had to be calculated and taken into account; and on the other, the potential additional costs of adopting a new governance model also had to be calculated and considered. Additionally, institutional legacy and interest group (the main developer, nearby villagers) bargaining capacities also influenced institutional costs and returns in different directions and to varying extents. These also conditioned the future directions and trajectories in the evolution of appropriate governance models. This study expands previous theories of path dependence in institutional change, and thus contributes to the understanding of institutional changes in Hainan and transitional China.