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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
Note: Working Papers
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  1. 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.
  2. Rozelle Scott, 1994. "Rural Industrialization and Increasing Inequality: Emerging Patterns in China's Reforming Economy," Journal of Comparative Economics, Elsevier, vol. 19(3), pages 362-391, December.
  3. Lin, Justin Yifu, 1992. "Rural Reforms and Agricultural Growth in China," American Economic Review, American Economic Association, vol. 82(1), pages 34-51, March.
  4. 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.
  5. Weitzman Martin L. & Xu Chenggang, 1994. "Chinese Township-Village Enterprises as Vaguely Defined Cooperatives," Journal of Comparative Economics, Elsevier, vol. 18(2), pages 121-145, April.
  6. 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.
  7. 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.
  8. Chang Chun & Wang Yijiang, 1994. "The Nature of the Township-Village Enterprise," Journal of Comparative Economics, Elsevier, vol. 19(3), pages 434-452, December.
  9. 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.
  10. 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.
  11. Jiahua Che & Yingyi Qian, 1998. "Insecure Property Rights And Government Ownership Of Firms," The Quarterly Journal of Economics, MIT Press, vol. 113(2), pages 467-496, May.
  12. 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.
  13. Steven Lim, 1994. "Rural Industry: Interactions with Agriculture and State Industry," Chinese Economies Research Centre (CERC) Working Papers 1994-08, University of Adelaide, Chinese Economies Research Centre.
  14. 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.
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