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Chinese Rural Industrialisation in the Context of the East Asian Miracle

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  • Justin Yifu Lin

Abstract

This paper synthesises the different explanations and presents an overview of the development and characteristics of the Chinese rural enterprises (REs). The rural industrialization history of the Chinese provinces in the last 30 some years is analyzed. Among other results, the analysis has reached the following conclusions. First, provincial diversity in RE development is strongly linked with the capital stock in the rural area; in other words, a province with a comparative advantage in industry relative to agriculture has a larger RE sector. Second, a lighter SOE sector at the outset of the development helps a province develop a larger RE sector. This result suggests that a province that initially abided by China's comparative advantage in labour intensive industries laid a better stage for its future RE development. Thirdly, a larger share of public REs hinders the overall RE development in a province in the reform period. This last result contradicts the prediction provided by many theories advocating the vaguely defined property rights widely observed in Chinese REs. The Chinese experience is also placed in the context in East Asia, noticeably, Thailand.

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Bibliographic Info

Paper provided by eSocialSciences in its series Working Papers with number id:647.

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Date of creation: Oct 2006
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Handle: RePEc:ess:wpaper:id:647

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Keywords: rural enterprises; China; small industry; agriculture; labour intensive industry; East Asia; Thailand; China Studies;

References

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  1. Wu Yanrui, 1993. "One Industry, Two Regimes: The Chinese Textile Sector Growth, Reforms and Efficiency," Chinese Economies Research Centre (CERC) Working Papers, University of Adelaide, Chinese Economies Research Centre 1993-02, University of Adelaide, Chinese Economies Research Centre.
  2. Jiahua Che & Yingyi Qian, 1997. "Insecure Property rights and Government Ownership of Firms," William Davidson Institute Working Papers Series 51, William Davidson Institute at the University of Michigan.
  3. Yao, Yang, 1999. "Rural industry and labor market integration in eastern China," Journal of Development Economics, Elsevier, Elsevier, vol. 59(2), pages 463-496, August.
  4. Dong, Xiao-yuan & Putterman, Louis, 1997. "Productivity and Organization in China's Rural Industries: A Stochastic Frontier Analysis," Journal of Comparative Economics, Elsevier, vol. 24(2), pages 181-201, April.
  5. Weitzman Martin L. & Xu Chenggang, 1994. "Chinese Township-Village Enterprises as Vaguely Defined Cooperatives," Journal of Comparative Economics, Elsevier, vol. 18(2), pages 121-145, April.
  6. Shouying Liu & MICHAEL R. CARTER & Yang Yao, 1996. "Dimensions and Diversity of Property Rights in Rural China: Delimmas on the Road to Further Reform," Wisconsin-Madison Agricultural and Applied Economics Staff Papers, Wisconsin-Madison Agricultural and Applied Economics Department 395, Wisconsin-Madison Agricultural and Applied Economics Department.
  7. Wu Yanrui, 1992. "Productivity Performance of Chinese Rural Enterprises: A Comparative Study," Chinese Economies Research Centre (CERC) Working Papers, University of Adelaide, Chinese Economies Research Centre 1992-07, University of Adelaide, Chinese Economies Research Centre.
  8. Wu Yanrui, 1990. "Rural Industrialization in China: A General Equilibrium Analysis," Chinese Economies Research Centre (CERC) Working Papers, University of Adelaide, Chinese Economies Research Centre 1990-02, University of Adelaide, Chinese Economies Research Centre.
  9. Harry X Wu, 1992. "China's Rural Economic Performance during the Reform Decade: Estimates and Assessments," Chinese Economies Research Centre (CERC) Working Papers, University of Adelaide, Chinese Economies Research Centre 1992-05, University of Adelaide, Chinese Economies Research Centre.
  10. Nugent, Jeffrey B., 1996. "What explains the trend reversal in the size distribution of Korean manufacturing establishments?," Journal of Development Economics, Elsevier, Elsevier, vol. 48(2), pages 225-251, March.
  11. Kuznets, Paul W, 1988. "An East Asian Model of Economic Development: Japan, Taiwan, and South Korea," Economic Development and Cultural Change, University of Chicago Press, vol. 36(3), pages S11-43, Supplemen.
  12. Jefferson, Gary H. & Rawski, Thomas G. & Zheng, Yuxin, 1996. "Chinese Industrial Productivity: Trends, Measurement Issues, and Recent Developments," Journal of Comparative Economics, Elsevier, vol. 23(2), pages 146-180, October.
  13. Lin, Justin Yifu, 1992. "Rural Reforms and Agricultural Growth in China," American Economic Review, American Economic Association, American Economic Association, vol. 82(1), pages 34-51, March.
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