Provincial Strategies of Economic Reform in Post-Mao China: Leadership, Politics, and Implementation (review)

Subnational studies of contemporary China have always constituted one of the major research topics in Chinese studies. The earlier milestone research of Ezra Vogel on Guangzhou in the late 1960s and Nicholas Lardy on center-provincial fiscal relations in the 1970s helped to define subnational political and economic studies as a discipline. In the past decade and a half, this topic has attracted even greater interest. The studies of Guangdong and the Pearl River Delta in particular were started mostly by Hong Kong geographers and planners in the 1980s. In the 1990s, other scholars investigated the political and economic relationship between the provinces and the center. In relation to the last field, this edited volume, containing essays by nine scholars who have worked on provincial politics and who have impressive publication credentials, is a welcome contribution.

This book is a study of provincial leaders and their role in designing and implementing economic reform policies. In the introduction the editors clearly set out their methodology. Peter T. Y. Cheung states the objectives and research design, and along the way he provides a masterful overview of past researches and their significance. The opening chapter concludes with a summary of the findings of the volume's eight case studies.

In assessing the performance of the provincial leaders, the editors selected resource allocation and foreign investment as the two areas for investigation. How effective the leaders were in prioritizing capital investment for growth, and how successful they were in securing foreign investment were the criteria for evaluating their performance in implementing economic reform. The eight case studies are divided into two equal parts: four studies on resource allocation and four on foreign investment.

The four cases for resource allocation include Shanghai, Guangdong, Zhejiang, and Shaanxi. Zhimin Lin credits the recent spectacular growth in Shanghai to aggressive provincial leaders and their links to the center, their ability to secure greater control of local revenue by reducing remissions to the center, the mobilization of non-budgetary resources through the market, and the adjustment of allocations toward capital construction and the updating of technology. The economic take-off is largely credited to those provincial leaders who were open-minded and favored populist programs.

For Guangdong, Peter T. Y. Cheung examines how the provincial leaders gained considerable autonomy in formulating economic policy, as a result, for example, of the establishment of three Special Economic Zones and the decentralization of economic authority to the subprovincial level; this became the key to propelling Guangdong into its position as China's wealthiest province. With his father Ye Jiangying at the center, the provincial governor, Ye Xuanping, managed the center-provincial relations in his relatively long tenure during the crucial second half of the 1980s. The recent slowdown is explained as due to the as yet unrealized long-term returns on investment in infrastructure and education, to the saturation of the real estate market, and to social disorder.

Zhejiang is a particularly interesting case. Keith Forster offers a portrayal of a succession of passive provincial leaders who rarely took the initiative in economic reform. Yet, despite the lack of an innovative provincial policy, the erosion of planned allocation was replaced by market forces. The collective and private enterprises, aided by the nearby industrial centers—Shanghai in particular—took the initiative in economic development. Because of the efforts of the non-state sectors, Zhejiang outperformed many other provinces.

In the last case study, of land-locked Shaanxi, the legendary base of the Chinese revolution, Kevin P. Lane examines the consequences of conservative leadership, ideological inertia, and the lack of an interregional infrastructure in the resource rich southern part of the province. With the slow implementation of economic reform policies by a reluctant leadership, with the reduced capital transfusion from the center...