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Permanency and flexibility of institutions : the role of decentralisation in Chinese economic reforms

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  • Philippe DULBECCO

    () (Centre d'Etudes et de Recherches sur le Développement International(CERDI))

  • Mary-Françoise RENARD

    () (Centre d'Etudes et de Recherches sur le Développement International(CERDI))

Abstract

The purpose of our paper is to offer a new analysis aimed at studying the coherence and the efficiency of reforms in China in terms of institutional change. The idea is that transition dynamics cannot be analysed by reference to market criteria only; transition is, above all, a change in institutions. Every transition economy thus faces the problem of creating a new institutional framework which associates the co-ordination of activities by the market with the preservation of a centralised mechanism of resource allocation. We explain that, in China, this role is played by decentralisation. Indeed we demonstrate that Chinese economic reforms, of which the main institutional vector is decentralisation, show the particularity of reconciling, within one single logic, the permanency of a well-established institutional order required for the co-ordination of individual plans, and the flexibility of institutions necessary for the move towards the market. We then defend the theory that both the success and the originality of Chinese economic reforms rest on their capacity to resolve the permanency-flexibility dilemma.

Suggested Citation

  • Philippe DULBECCO & Mary-Françoise RENARD, 1999. "Permanency and flexibility of institutions : the role of decentralisation in Chinese economic reforms," Working Papers 199924, CERDI.
  • Handle: RePEc:cdi:wpaper:123
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    References listed on IDEAS

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    Cited by:

    1. Marius Korsnes, 2014. "Fragmentation, Centralisation and Policy Learning: An Example from China’s Wind Industry," Journal of Current Chinese Affairs - China aktuell, Institute of Asian Studies, GIGA German Institute of Global and Area Studies, Hamburg, vol. 43(3), pages 175-205.

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