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Principal Agent Theory and Private Property Rights in China's Economic Reform
- China: An International Journal
- NUS Press Pte Ltd
- Volume 7, Number 1, March 2009
- pp. 57-80
- 10.1353/chn.2009.a261306
- Article
- Additional Information
China's economic reforms have been studied using all manner of paradigms and theories. Some fit well, while others do not. It is argued that the principal agent theory is not suitable for analysing state-owned enterprises as by definition the principals must be able to make the decisions and own the property rights. Misconceptions abound concerning the nature of property rights and the township and village enterprises.