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The Disinterested Government: An Interpretation of China's Economic Success in the Reform Era

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  • Yao, Yang
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    Abstract

    In the last 30 years, China has achieved high economic growth and successfully transformed its economy from a planned economy to a market-based system. The country, to a large extent, has attained success through the recommendations proposed by standard economic theory. However, the role of political economy has been omitted from the literature: how did China adopt the right economic policies and the appropriate road to reform? This paper attempts to answer this question. The central assumption of the paper is that China achieved success because the Chinese government has been a disinterested party, i.e., a government that does not favour any particular sections of the population and prioritizes the long-term welfare of the whole society. In this paper, we first define and analyse the concept of disinterested governments, and then proceed to provide several examples to demonstrate that China has been characterized by a disinterested government. Based on a theoretical model, we also discuss the reasons of the

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    File URL: http://www.wider.unu.edu/stc/repec/pdfs/rp2009/RP2009-33.pdf
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    Bibliographic Info

    Paper provided by World Institute for Development Economic Research (UNU-WIDER) in its series Working Paper Series with number UNU-WIDER Research Paper RP2009/33.

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    Length: 21
    Date of creation: 2009
    Date of revision:
    Handle: RePEc:unu:wpaper:rp2009-33

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    Keywords: Disinterested governments; the China miracle; econimic reform;

    This paper has been announced in the following NEP Reports:

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    1. Zhang, Xiaobo & Fan, Shenggen & Zhang, Linxiu & Huang, Jikun, 2002. "Local governance and public goods provision in rural China:," EPTD discussion papers 93, International Food Policy Research Institute (IFPRI).
    2. Murphy, Kevin M & Shleifer, Andrei & Vishny, Robert W, 1992. "The Transition to a Market Economy: Pitfalls of Partial Reform," The Quarterly Journal of Economics, MIT Press, vol. 107(3), pages 889-906, August.
    3. Yingyi Qian & Barry R. Weingast, 1997. "Federalism as a Commitment to Reserving Market Incentives," Journal of Economic Perspectives, American Economic Association, vol. 11(4), pages 83-92, Fall.
    4. Rodrik, Dani & Alesina, Alberto, 1994. "Distributive Politics and Economic Growth," Scholarly Articles 4551798, Harvard University Department of Economics.
    5. Wang, Shuna & Yao, Yang, 2007. "Grassroots Democracy and Local Governance: Evidence from Rural China," World Development, Elsevier, vol. 35(10), pages 1635-1649, October.
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