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China as a Developmental State

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  • John Knight

Abstract

The paper examines the notion of a ‘developmental state’ and shows that China possesses the characteristics of a developmental state. It explains the political economy which generated such a state in China and in some other economies. It analyses the methods and mechanisms that were introduced to create a developmental state, in particular the incentive structures that the leadership used to solve the principal-agent problem. These include personnel policies, fiscal decentralization, and patronage relationships. That leads to a review of its successes, limitations and adverse consequences, and to the question: can China’s developmental state be sustained? Conclusions are drawn for both China and other developing countries.

Suggested Citation

  • John Knight, 2012. "China as a Developmental State," CSAE Working Paper Series 2012-13, Centre for the Study of African Economies, University of Oxford.
  • Handle: RePEc:csa:wpaper:2012-13
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    File URL: http://www.csae.ox.ac.uk/materials/papers/csae-wps-2012-13.pdf
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    References listed on IDEAS

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    Cited by:

    1. Boddewyn, Jean J., 2016. "International business–government relations research 1945–2015: Concepts, typologies, theories and methodologies," Journal of World Business, Elsevier, pages 10-22.
    2. repec:bla:growch:v:48:y:2017:i:3:p:459-486 is not listed on IDEAS
    3. Andrea Fracasso, 2015. "Economic Rebalancing and Growth: the Japanese experience and China’s prospects," DEM Discussion Papers 2015/07, Department of Economics and Management.
    4. Han, Enze & Paik, Christopher, 2017. "Ethnic Integration and Development in China," World Development, Elsevier, vol. 93(C), pages 31-42.
    5. Shen, Xiaoxiao & Tsai, Kellee S., 2016. "Institutional Adaptability in China: Local Developmental Models Under Changing Economic Conditions," World Development, Elsevier, vol. 87(C), pages 107-127.

    More about this item

    Keywords

    China; Developmental state; Economic growth; Incentives; Principal-agent problem; Virtuous circle;

    JEL classification:

    • B52 - Schools of Economic Thought and Methodology - - Current Heterodox Approaches - - - Historical; Institutional; Evolutionary
    • E02 - Macroeconomics and Monetary Economics - - General - - - Institutions and the Macroeconomy
    • O10 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - General
    • O53 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Asia including Middle East
    • P16 - Economic Systems - - Capitalist Systems - - - Political Economy of Capitalism
    • P26 - Economic Systems - - Socialist Systems and Transition Economies - - - Political Economy

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