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Chinese Rural Industrialisation in the Context of the East Asian Miracle

  • Justin Yifu Lin

This paper synthesises the different explanations and presents an overview of the development and characteristics of the Chinese rural enterprises (REs). The rural industrialization history of the Chinese provinces in the last 30 some years is analyzed. Among other results, the analysis has reached the following conclusions. First, provincial diversity in RE development is strongly linked with the capital stock in the rural area; in other words, a province with a comparative advantage in industry relative to agriculture has a larger RE sector. Second, a lighter SOE sector at the outset of the development helps a province develop a larger RE sector. This result suggests that a province that initially abided by China's comparative advantage in labour intensive industries laid a better stage for its future RE development. Thirdly, a larger share of public REs hinders the overall RE development in a province in the reform period. This last result contradicts the prediction provided by many theories advocating the vaguely defined property rights widely observed in Chinese REs. The Chinese experience is also placed in the context in East Asia, noticeably, Thailand.

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Paper provided by eSocialSciences in its series Working Papers with number id:647.

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Date of creation: Oct 2006
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Handle: RePEc:ess:wpaper:id:647
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  1. Wu Yanrui, 1990. "Rural Industrialization in China: A General Equilibrium Analysis," Chinese Economies Research Centre (CERC) Working Papers 1990-02, University of Adelaide, Chinese Economies Research Centre.
  2. Jiahua Che & Yingyi Qian, 1997. "Insecure Property rights and Government Ownership of Firms," William Davidson Institute Working Papers Series 51, William Davidson Institute at the University of Michigan.
  3. Liu, Shouying & Carter, Michael R. & Yao, Yang, 1998. "Dimensions and diversity of property rights in rural China: Dilemmas on the road to further reform," World Development, Elsevier, vol. 26(10), pages 1789-1806, October.
  4. M Weitzman & Cheng-Gang Xu, 1993. "Chinese township village enterprises as vaguely defined cooperations," LSE Research Online Documents on Economics 3754, London School of Economics and Political Science, LSE Library.
  5. Kuznets, Paul W, 1988. "An East Asian Model of Economic Development: Japan, Taiwan, and South Korea," Economic Development and Cultural Change, University of Chicago Press, vol. 36(3), pages S11-43, Supplemen.
  6. Wu Yanrui, 1993. "One Industry, Two Regimes: The Chinese Textile Sector Growth, Reforms and Efficiency," Chinese Economies Research Centre (CERC) Working Papers 1993-02, University of Adelaide, Chinese Economies Research Centre.
  7. Wu Yanrui, 1992. "Productivity Performance of Chinese Rural Enterprises: A Comparative Study," Chinese Economies Research Centre (CERC) Working Papers 1992-07, University of Adelaide, Chinese Economies Research Centre.
  8. Jefferson, Gary H. & Rawski, Thomas G. & Zheng, Yuxin, 1996. "Chinese Industrial Productivity: Trends, Measurement Issues, and Recent Developments," Journal of Comparative Economics, Elsevier, vol. 23(2), pages 146-180, October.
  9. Yao, Yang, 1999. "Rural industry and labor market integration in eastern China," Journal of Development Economics, Elsevier, vol. 59(2), pages 463-496, August.
  10. Nugent, Jeffrey B., 1996. "What explains the trend reversal in the size distribution of Korean manufacturing establishments?," Journal of Development Economics, Elsevier, vol. 48(2), pages 225-251, March.
  11. Lin, Justin Yifu, 1992. "Rural Reforms and Agricultural Growth in China," American Economic Review, American Economic Association, vol. 82(1), pages 34-51, March.
  12. Dong, Xiao-yuan & Putterman, Louis, 1997. "Productivity and Organization in China's Rural Industries: A Stochastic Frontier Analysis," Journal of Comparative Economics, Elsevier, vol. 24(2), pages 181-201, April.
  13. Harry X Wu, 1992. "China's Rural Economic Performance during the Reform Decade: Estimates and Assessments," Chinese Economies Research Centre (CERC) Working Papers 1992-05, University of Adelaide, Chinese Economies Research Centre.
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