Taking Risks in Experimenting with Private Enterprise

China’s private enterprises first re-emerged in rural Wenzhou in the late 1970s and early 1980s after three decades of extreme anti-private economy policies. Because the Maoist legacy continued to the late 1980s, the revival of private practice encountered regulative, normative, and cognitive institutional resistance (Scott 1995). This chapter explores two main questions: (1) What factors impacted the entry into private entrepreneurship under the ambiguous and still somewhat hostile environment? and (2) How did the actors, such as peasant entrepreneurs and cadres in the field, break through the policies and construct new institutions against the ambiguous environment, particularly, how did they fend off the political risks? This chapter will begin with discussions of the literature of transitional societies. Then I will briefly introduce the subject of rural industrialization since Mao and the development of private enterprises. This chapter will mainly focus on Wenzhou’s takeoff in the early 1980s, the elements of private entrepreneurship, and the roles of local cadres, peasant entrepreneurs, and the central market-oriented leaders.