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The Puzzle of China's Township¥VVillage Enterprises: The Paradox of Local Corporatism in a Dual-Track Economic Transition


  • Peter Ping Li

    (California State University)


This paper seeks to reconcile and synthesize the diverse views about the township¥Vvillage enterprises (TVEs) and local corporatism in the context of ongoing institutional changes in China as a transition economy. Specifically, I attempt to integrate the economic, political, cultural, and social explanations for TVEs, especially the two competing views of market competition and political corruption. I focus on the puzzle of TVE efficiency as well as the paradox of local corporatism as a government¥Vbusiness partnership with both a positive function of public alliance for wealth creation and a negative function of private collusion for wealth transfer. I argue that the key to both the puzzle of TVEs and the paradox of local corporatism lies in China's dual-track reform paradigm (i.e. a market-for-mass track and a state-for-elite track). Lastly, I discuss the critical implications for theory building and policymaking regarding economic transition in general.

Suggested Citation

  • Peter Ping Li, 2005. "The Puzzle of China's Township¥VVillage Enterprises: The Paradox of Local Corporatism in a Dual-Track Economic Transition," Management and Organization Review, International Association of Chinese Management Research, vol. 1(2), pages 197-224, July.
  • Handle: RePEc:cmr:mor101:v:1:y:2005:i:2:p:197-224

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    Cited by:

    1. Barbara Krug & Hans Hendrischke, 2012. "Market design in Chinese market places," Asia Pacific Journal of Management, Springer, vol. 29(3), pages 525-546, September.
    2. Krug, B. & Hendrischke, H., 2006. "Institution Building and Change in China," ERIM Report Series Research in Management ERS-2006-008-ORG, Erasmus Research Institute of Management (ERIM), ERIM is the joint research institute of the Rotterdam School of Management, Erasmus University and the Erasmus School of Economics (ESE) at Erasmus University Rotterdam.
    3. Peter Li, 2012. "Toward an integrative framework of indigenous research: The geocentric implications of Yin-Yang Balance," Asia Pacific Journal of Management, Springer, vol. 29(4), pages 849-872, December.
    4. Li, Peter Ping, 2007. "Toward an integrated theory of multinational evolution: The evidence of Chinese multinational enterprises as latecomers," Journal of International Management, Elsevier, vol. 13(3), pages 296-318, September.


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