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Local Granaries and Central Government Disaster Relief: Moral Hazard and Intergovernmental Finance in Eighteenth- and Nineteenth-Century China

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  • SHIUE, CAROL H.

Abstract

During the eighteenth and nineteenth centuries, the Chinese state attempted to administer famine relief partly through a nationwide institution of local granaries. This article explores regional variations in the performance of this institution to understand the reasons for its ultimate breakdown. The evidence suggests granary storage levels were systematically lower in provinces that received more frequent central government disaster relief; and an unintended consequence of disaster relief was that it modified local incentives for self-insurance and led to an incompletely resolved moral-hazard problem. China s experience provides an instructive example of the long-term dynamics present in intergovernmental policies.

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Bibliographic Info

Article provided by Cambridge University Press in its journal The Journal of Economic History.

Volume (Year): 64 (2004)
Issue (Month): 01 (March)
Pages: 100-124

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Handle: RePEc:cup:jechis:v:64:y:2004:i:01:p:100-124_00

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Cited by:
  1. Eiji Yamamura, 2013. "Impact of natural disaster on public sector corruption," Development Research Working Paper Series 06/2013, Institute for Advanced Development Studies.
  2. Cormac Ó Gráda, 2007. "Famines and Markets," Working Papers 200720, School Of Economics, University College Dublin.
  3. Keller, Wolfgang & Shiue, Carol Hua, 2004. "Markets in China and Europe on the Eve of the Industrial Revolution," CEPR Discussion Papers 4420, C.E.P.R. Discussion Papers.
  4. Qiang Chen, 2014. "Natural Disasters, Ethnic Diversity, and the Size of Nations: Two Thousand Years of Unification and Division in Historical China," SDU Working Papers 2014-01, School of Economics, Shandong University.
  5. Yamamura, Eiji, 2013. "Impact of natural disasters on income inequality: Analysis using panel data during the period 1965 to 2004," MPRA Paper 45623, University Library of Munich, Germany.
  6. Haiwen Zhou, 2011. "Confucianism and the Legalism: A model of the national strategy of governance in ancient China," Frontiers of Economics in China, Springer, vol. 6(4), pages 616-637, December.
  7. Cormac Ó Gráda, 2006. "Making Famine History," Working Papers 200610, School Of Economics, University College Dublin.
  8. Meng, Xin & Qian, Nancy & Yared, Pierre, 2010. "The Institutional Causes of China's Great Famine, 1959-61," CEPR Discussion Papers 8012, C.E.P.R. Discussion Papers.
  9. Wolfgang Keller & Carol H. Shiue, 2003. "The Origins of Spatial Interaction," NBER Working Papers 10069, National Bureau of Economic Research, Inc.
  10. Qiang Chen, 2013. "Climate Shocks, State Capacity, and Peasant Uprisings in North China during 25-1911 CE," SDU Working Papers 2013-01, School of Economics, Shandong University.
  11. Martin Uebele & Tim Grünebaum & Michael Kopsidis, 2013. "King's law and food storage in Saxony, c. 1790-1830," CQE Working Papers 2613, Center for Quantitative Economics (CQE), University of Muenster.

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