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Politics, Markets, and Modes of Contract Governance: Regulating Social Services in Shanghai and Chongqing, China

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  • Wei Li
  • Bao Yang

Abstract

Inspired by the concept of the regulatory welfare state , this article identifies four primary modes of governance in regulating contract processes and contract implementation (market-based, hierarchical, professional, and relational), and compares contract governance modes in Shanghai and Chongqing. We find that the governments in these two localities prioritize and integrate the hierarchical and relational modes, relying less on the market-based and professional modes of governance. The emphasis on the hierarchical-relational mode advances the values and mechanisms of trust, adaptation, and alignment with top-down priorities, but may hinder public and legal accountability. We argue that the dynamics of political context and market condition affect the formation and effectiveness of hybrid modes of contract governance, and we advise that regulators in different countries should factor in such dynamics when designing contract governance modes in the regulation of social services.

Suggested Citation

  • Wei Li & Bao Yang, 2020. "Politics, Markets, and Modes of Contract Governance: Regulating Social Services in Shanghai and Chongqing, China," The ANNALS of the American Academy of Political and Social Science, , vol. 691(1), pages 121-137, September.
    • Handle: RePEc:sae:anname:v:691:y:2020:i:1:p:121-137
    DOI: 10.1177/0002716220957286
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