Chinese Economic Reform Research Articles

The Emergence of Greater China: The Economic Integration of Mainland China, Taiwan and Hong Kong. By Yung-Wing Sung. [Basingstoke and New York: Palgrave Macmillan, 2005. xvi+236 pp. ISBN 0-333-62599-4.

This is a highly readable book about the emerging economic complex of “Greater China.” The author, based at the Chinese University of Hong Kong, is the foremost authority on the subject matter. The book, which culminates from well over a decade of painstaking research and publication, traces the process and pattern of economic integration among the Chinese trio – the Chinese mainland, Hong Kong and Taiwan – over the past two decades or so. The analysis is set against the broader background of Chinese economic reforms and opening to the West, as well as the changing political context in East Asia that has facilitated increased economic interaction in the region.The book starts with a broad description of the economic structure and relative economic strengths of the Chinese trio, and furnishes a useful conceptual framework for understanding the evolving economic relationships. Chapter two shows how FDI (foreign direct investment) from Hong Kong and Taiwan has triggered an accelerated process of integration with the mainland, and as a result led to the drastic expansion of China's external trade. Chapter three examines the particular characteristics of economic integration between Hong Kong and the mainland on the one hand, and between the two sides of the Taiwan Strait on the other hand. It reveals how cultural (affinity) and geographical (proximity) factors have played a role, and what policy readjustments have been made in the three constituent parts of the “China circle” to bring about a “new brand of ‘new-style’ economic integration,” which is unique in the global context of trade and investment liberalization.

Currency convertibility, cost of capital control and capital account liberalization in China

This paper provides a synthetic view of the capital account liberalization, capital control and currency convertibility issues in China. A quantitative analysis following Henry’s study1 fails to provide clear links between liberalization, diminishing capital controls and Chinese stock market returns. An institutional explanation is then offered to complement the quantitative analysis. We suggest that the property rights regime is an indispensable institutional variable when studying this topic. Originating from the current property rights regime; price distortion, moral hazard and monetary overhang are the main impediments towards capital account liberalization and full convertibility. Therefore, property rights reform should be given the first priority in Chinese economic reform.

Towards a Balanced Development: Regulation of Beneficial Conflicts among Administrative Regions in China

extract] As a consequence of economic decentralization, which is a main aspect of Chinese economic reform, local governments have obtained much more economic powers. This means that the local governments have become not only much more self-determining in relation to the central government, but have acquired much greater power to manage directly the economic entities within their jurisdiction, and even the main players of economic competition and development. In this situation, local governments tend to make every effort to maximize economic interests of their own. Consequently, negative phenomena have largely emerged in recent years, such as heaps of duplicate constructions, over-consuming of natural resources, various preferential policies for absorbing capital, unsighted reduction of tax, low-priced or free lending of land and numerous ways of local protectionism. Economic division among administrative regions and local protection of native interests certainly hinder the freedom and fairness of trade, and the shape of a unified free market. Moreover, these have led to worrisome beneficial conflicts among administrative regions, which have showed disadvantages on the unified interests between the state and citizens. The conflicts are turning out to be serious, and thus noteworthy.

NORTH KOREAN ECONOMIC ADJUSTMENT POLICY: A COMPARISON WITH CHINESE ECONOMIC REFORM POLICY

In July 2002, North Korea announced a series of economic adjustment policies. This paper compares the adjustment policy of North Korea with the reform policy of China. North Korea, unlike China, had no real change in the political regimes and, therefore, it was inevitable that the reform would not be very comprehensive. In any reform, a proper of reforms is important. North Korea ignored the proper sequence of reform. For instance, in North Korea price reform was implemented first without securing an adequate supply of food and consumer production despite an acute shortage of supply in these goods. The results of the adjustment policy were hyper-inflation and a wider gap in income distribution.

The "End of Politics" in Beijing

Previous articleNext article No AccessThe "End of Politics" in BeijingBruce GilleyBruce Gilley Search for more articles by this author PDFPDF PLUS Add to favoritesDownload CitationTrack CitationsPermissionsReprints Share onFacebookTwitterLinkedInRedditEmail SectionsMoreDetailsFiguresReferencesCited by The China Journal Volume 51Jan., 2004 Published on behalf of the Australian Centre on China in the World at the Australian National University Article DOIhttps://doi.org/10.2307/3182149 Views: 38Total views on this site Citations: 6Citations are reported from Crossref Copyright 2004 The China JournalPDF download Crossref reports the following articles citing this article:Rongxin Li Introduction, (Aug 2022): 1–7.https://doi.org/10.1007/978-981-19-3869-6_1Rongxing Guo Understanding Chinese Economic Reform, (Dec 2016): 199–233.https://doi.org/10.1007/978-3-319-32306-0_7Jennifer Y.J. Hsu Strategic Collaboration, Avoidance and Ignorance in State-NGO Relations, SSRN Electronic Journal (Jan 2015).https://doi.org/10.2139/ssrn.2660633Rongxing Guo Understanding Chinese Economic Reform, (Jan 2013): 107–123.https://doi.org/10.1016/B978-0-12-397826-4.00007-XDeval Desai, Michael Woolcock The Politics of Rule of Law Systems in Developmental States: ‘Political Settlements’ as a Basis for Promoting Effective Justice Institutions for Marginalized Groups, SSRN Electronic Journal (Jan 2012).https://doi.org/10.2139/ssrn.2141876Simon Shen The Stabilizing Function of Chinese Nationalism: Conclusion, (Jan 2007): 165–202.https://doi.org/10.1057/9780230590007_6

The Internet in India and China

With our colleagues in the Mosaic group, we have done several studies of the state of the Internet in India and in China beginning in 1998. These studies were conducted using a six-dimension framework we have developed for characterizing the state of the Internet in a nation. In 1999, we published a comparison of the state of the Internet in China and India. At that time we found that China had a clear lead in each of our six dimensions. This paper updates the comparison. We compare China and India on our six dimensions and find that China continues to have a substantial lead. We also see that India has made significant strides since our 1999 comparison. After examining the six dimensions, we turn to determinants of the values of those dimensions. What has led to China's lead and the progress that both nations have made recently? We conclude that the following factors were important in shaping China's lead over India. (1) Although Indian universities undertook Internet experiments before those of China, China decided to make the Internet a priority and began building it in earnest before India. (2) Chinese economic reforms, which began in the late 1980s, provided both capital for and openness to the Internet. (3) The pre-Internet Chinese decision to invest in telecommunication infrastructure and information technology industries provided complementary infrastructure and human resources for the Internet. (4) The Chinese ability to execute by decree rather than consensus building followed by legislative and regulatory reform accelerated the diffusion of the Internet. (5) The Chinese were able to create competition among government-owned organizations without taking time for legislative change and the raising of private capital. (6) The Chinese were able to establish competitors to the incumbent telephone company relatively rapidly. Although these factors jump-started the Chinese Internet, and will continue to work in its favor, market forces and openness of access and content may serve India well in the long run. Furthermore, there are also great similarities between the two nations, and we hope they will learn from each other and lead other developing nations.

China's Economic Challenge: Smashing the Iron Rice Bowl. By Neil C. Hughes. [Armonk, NY and London: M. E. Sharpe, 2002. 256 pp. $58.95. ISBN 0-7656-0808-1.

This book about Chinese economic reform is written by an industrial and financial specialist. It examines the argument of China's moving from a centrally-planned economy to one with more market components, asking, in the author's words, “whether the iron rice bowl has already been broken.” There are seven chapters in total.

Book Review: Chinese Economic Reforms and Fertility Behaviour. A Study of a North China Village

Book Review: Chinese Economic Reforms and Fertility Behaviour. A Study of a North China Village

Permanency and flexibility of institutions: the role of decentralisation in Chinese economic reforms

The purpose of our paper is to offer a new analysis aimed at studying the coherence and the efficiency of reforms in China in terms of institutional change. The idea is that transition dynamics cannot be analysed by reference to market criteria only; transition is, above all, a change in institutions. Every transition economy thus faces the problem of creating a new institutional framework which associates the co-ordination of activities by the market with the preservation of a centralised mechanism of resource allocation. We explain that, in China, this role is played by decentralisation. Indeed we demonstrate that Chinese economic reforms, of which the main institutional vector is decentralisation, show the particularity of reconciling, within one single logic, the permanency of a well-established institutional order required for the co-ordination of individual plans, and the flexibility of institutions necessary for the move towards the market. We then defend the theory that both the success and the originality of Chinese economic reforms rest on their capacity to resolve the permanency-flexibility dilemma.

Chinese Cinema's Economic Reform From the Mid-1980s to the Mid-1990s

Chinese Cinema's Economic Reform From the Mid-1980s to the Mid-1990s

China's Banking Reform

This article discusses the main problems facing the Chinese banking system and concludes that, despite serious problems, the risk seems small that, in the near future, a financial crisis will occur that will pose severe problems for the international financial system. An internal financial crisis, however, could occur. Without government support, the economic viability of many of China's banks is questionable. The government and central bank authorities acknowledge the situation and have taken some steps toward reform. The most serious threat to the banking system lies in the accumulation of non-performing loans (NPLs)--many of them policybased loans extended by state-owned banks to money-losing state-owned companies with little expectation that they would be completely repaid. China has been taking measures to keep the problem from worsening and has created four asset management companies to dispose of NPLs that still have value. Since the Chinese economic reforms began in 1978, Chinese authorities have made significant progress in modernising their banking system, although they still have a long way to go. However, there are several ameliorating factors that still keep its financial and foreign exchange system viable. China's continued high rate of growth and high savings rate have funneled deposits into the banking system, while a $20-30 billion annual trade surplus together with an inflow of foreign direct investment at about $40 billion per year have resulted in an accumulation of foreign exchange reserves exceeding $200 billion. China does not carry an unusually heavy debt burden, either domestic or international, although its short-term borrowing in foreign currencies has been increasing. China does not currently face a serious risk of either a domestic or international liquidity crisis--unless, of course, a severe and prolonged world recession occurs that adversely affects Chinese exports as well as the inflow of foreign direct investment.

China's Economic Challenge: Smashing the Iron Rice Bowl (review)

Reviewed by: China's Economic Challenge: Smashing the Iron Rice Bowl Thomas G. Moore (bio) Neil C. Hughes . China's Economic Challenge: Smashing the Iron Rice Bowl. Armonk and London: M. E. Sharpe, 2002. xv, 235 pp. Hardcover $58.95, ISBN 0-7656-0808-1. Paperback $24.95, ISBN 0-7656-0809-X. As a general overview of China's economic reform in the post-Mao Zedong era, China's Economic Challenge can be considered a qualified success. Neil C. Hughes draws upon his eight years as a project manager in China for the World Bank to write a rather conventional account of Chinese economic reform in which he describes the myriad problems that continue to bedevil the country's leaders. Unlike other recent books intended for a general audience, such as Gordon Chang's The Coming Collapse of China (Random House, 2001), Hughes' book is no polemic. Instead, it is a thoughtful, balanced account of China's trials and tribulations, one that studiously avoids both excessive optimism and excessive pessimism. Here, China's Economic Challenge also distinguishes itself from the likes of David Sheff's China Dawn: The Story of a Technology and Business Revolution (HarperBusiness, 2002). To his credit Hughes has produced a comprehensive survey that, while mainly descriptive, is peppered with incisive observations. Not surprisingly, Hughes is most comfortable in discussing the inner workings of Chinese economic institutions and ongoing efforts to restructure the country's state-owned enterprises. Another strength of the book is its concerted effort to place China's contemporary challenges in historical perspective, an undertaking seen too rarely in books written by the burgeoning class of non-sinologists who have served lengthy professional assignments in the People's Republic over the last decade. Its strengths notwithstanding, China's Economic Challenge represents a missed opportunity in several respects. First, and perhaps most importantly, Hughes fails to provide an analytical framework to match the empirical story he tells. Indeed, the book too often reads like an unguided inventory of what ails China's economy, society, and political system. Chapter 1, which contains seventeen subsections in its thirty-five pages, illustrates this problem all too well. In addition [End Page 148] to the sheer number of issues that Hughes attempts to introduce, there is a jarring lack of transition as he moves from one issue to the next. This reviewer could not help but wonder how students would cope when confronted in the space of a few pages with consecutive subsections on the pension system, Party supervision of enterprises, environmental challenges, and efforts to adopt Western accounting standards—all with no commentary explaining how each relates to the larger dilemmas of China's transition from state socialism. Indeed, nowhere in this introductory chapter does Hughes preview a larger argument or otherwise indicate to the reader how the laundry list of problems he so carefully documents is linked to a larger vision in which China's various challenges can be brought into focus. While the book is informative, the presentation of material is such that readers relatively unfamiliar with the specifics of the subject—namely, students and lay people—are likely to encounter great difficulty in identifying an organizing theme. For experts, who will find the book's "story" quite familiar, there is no real conceptual or theoretical payoff. Even in his conclusion, chapter 7, Hughes offers mainly a summary rather than the kind of detailed analysis that would add to the existing popular and scholarly literature. The book's title notwithstanding, Hughes argues that the greatest economic challenge China faces is actually political in nature. In his words, China suffers from "a political climate of mistrust and hopelessness that is growing like a cancer in Chinese society" (p. 204). However much one might agree with this commentary, it does not serve as an adequate organizing theme for the rich empirical discussion that fills the preceding two hundred pages. Even at the book's end there is no analytical framework within which readers are supposed to pull together the threads of the story Hughes tells. Hughes does make some provocative assertions, however. One is his argument that "Values have to change before fundamental changes in behavior can...

A dynamic analysis of overstaff in China's state-owned enterprises

Overstaff in state-owned enterprises (SOEs) is a key and difficult issue in the Chinese economic reform. This paper models the transition process in the reform that SOE overstaff is gradually absorbed by private enterprises and the economy grows through converting redundant SOE workers into active labor force. It characterizes the steady equilibrium, where all overstaff has been completely absorbed, and the dynamic path from current state to the steady equilibrium. The optimal transition strategy maximizing household utility is also discussed.

Ownership Restructuring in Chinese State Industry: An Analysis of Evidence on Initial Organizational Changes

China has now entered the third decade of its economic reform. While the sweeping decollectivization in the rural sector during the early 1980s is widely regarded as successful, reform in the urban sector has proceeded at a much slower pace and with mixed results.For overviews, see Barry Naughton, Growing Out of the Plan: Chinese Economic Reform, 1978–1993 (New York: Cambridge University Press, 1995); Dwight H. Perkins, “Reforming China's economic system,” Journal of Economic Literature, Vol. 26 (1988), pp. 601–645, and “Completing China's move to the market,” Journal of Economic Perspectives, Vol. 8 (1994), pp. 23–46. The main carriers of economic activities in the urban sector are state-owned enterprises (SOEs). Since 1993, the Chinese government has embarked on a major effort to shift the focus of SOE reform from delegation of decision-making authority to enterprises, which was the predominant strategy in the preceding decade, to ownership restructuring.

Incentives and corruption in chinese economic reform*

This paper argues that, given the legacy of Chinese communism and its political structure, corruption, together with the threat of punishment for corruption and the selective enforcement of this threat, serves as a method of compensation that both satisfies the political objectives of the Communist Party and provides an effective inducement to local officials to promote economic reform.

Incentives and Corruption in Chinese Economic Reform

This paper argues that, given the legacy of Chinese communism and its political structure, corruption, together with the threat of punishment for corruption and the selective enforcement of this threat, serves as a method of compensation that both satisfies the political objectives of the Communist Party and provides an effective inducement to local officials to promote economic reform.

Transfer of technology: a critical element in China's privatisation process

Chinese economic reform has developed to a critical stage. To maintain and enlarge the achievement of economic development, China needs to privatise the State Owned Enterprises (SOE). This paper, first, discusses the general economic situation in China. Next, the necessity and benefits of technology transfer are addressed. Finally, several aspects of technology transfer are discussed and a model of technology transfer for achieving successful privatisation is suggested.

Trade and Financial Reform in China: Impacts on the World Economy

Despite the setbacks from the recent Asian currency crisis, the ascendancy of Asia as an economic centre of world economic activity is likely to continue into the 21st century. A key issue that will shape the role of Asia, and indeed the shape of the world economy in the 21st century, is the economic development of China. To date China has successfully weathered the currency storm in Asia and continues on a program of economic reform. If anything, the problems of Japan and Korea provide powerful lessons for other countries undergoing rapid economic growth and structural change. These lessons include the importance of a well developed financial sector with lending and investment decisions based on market signals rather than government directives. Whether China can further integrate smoothly into global markets and sustain the fast growth of the last few decades will be a crucial development in the world economy. In this paper, we explore the impacts of continued Chinese economic reform with a focus on the role of international financial flows both in the adjustment within China as well as in the transmission of Chinese reforms to the rest of the world.(This abstract was borrowed from another version of this item.)

Technology transfer to China: alliances of Chinese enterprises with western technology exporters

This article provides a detailed analysis on the potentiality for alliances involving technology transfer between Chinese enterprises and Western companies. It is based on a questionnaire survey covering 200 sample companies and factories in mechanical industries in China It covers technology imports from 1982 to 1997. A special diagram indicating alliance levels is provided, and sample Chinese recipients are shown. The main findings of the study are: 1. Chinese industries have enlarged their technology import scope in recent years, particularly after 1995. At the same time, the average size of each project has decreased dramatically, which reflects Chinese economic reform; 2. The proportion of hardware transfer is increasing, especially in licensing deals. This is a negative influence on Chinese industrial technology in that it is mature technology which is still largely transferred despite of a slightly positive change before 1992. 3. Ten different factors which influence the purchase of foreign technology by Chinese firms are provided. This is based on the perceptions of the firms concerned. A possible weighed factor system in technology assessment may be applicable to further transfers.

Income of the Urban Elderly in Postreform China: Political Capital, Human Capital, and the State

Using data from a 1992 nationally representative survey of the elderly in urban China, this study examines the impact of political and economic reforms on income stratification. Drawing upon the existing literature on the differential impact of market reforms in socialist states, we develop and test three hypotheses: one stressing the increasing importance of returns to human capital, one stressing the ability of communist elite to convert their political capital into new sources of power in emerging markets, and one stressing the continued importance of redistributive activities of the party-state. Our results support, to varying degrees, all three hypotheses. We interpret this as a reflection of the complex nature of stratification mechanisms during Chinese economic reforms.