China’s Political Economy: Theory and Evidence

Venue: Village West 15A, UC San Diego

Oct. 6, 2014 (Monday)

8:15 – 8:45 a.m.     Breakfast

8:45 – 9 a.m.     Welcome remarks by UC San Diego and Tsinghua orgnaizers

9 a.m. – 12 p.m.   Socialism/Capitalism with Chinese Characteristics

• “Crony Capitalism with Chinese Characteristics,” by Chong-En Bai, Tsinghua University
• “The Communist Party, the Private Entrepreneur, and the Law:  Theory and Evidence from China,” by Chenggang Xu, University of Hong Kong
• General discussion by Chang-tai Hsieh, University of Chicago

12 – 1 p.m.     Lunch

1 – 5 p.m.   Political Selection and Mobility

• “Shocks, Skills, and Political Stability in Authoritarian Regimes: A Theoretical Analysis,” by Victor Shih, UC San Diego
• “Social Mobility and Revolution: The Impact of the Abolition of China's Civil Service Exam System,” by Ruixue Jia, UC San Diego
• “Career Concerns, Beijing Style,” by Jiahua Che, Chinese University of Hong Kong
• General discussion by Gerard Roland, UC Berkeley

Oct. 7, 2014 (Tuesday)

8:30 – 9 a.m.     Breakfast

9 a.m. – 1 p.m.   Governance and Growth

• “Logrolling Under Fragmented Authoritarianism: Theory and Evidence from China,” by Yuan Li, University of Duisburg-Essen
• “Will China Escape the Middle-income Trap? Politico-economic Theory of Growth and State Capitalism," by Yikai Wang, University of Zurich
• General discussion by Loren Brandt, University of Toronto

12 – 1 p.m.    Lunch

1 – 5:45 p.m.      Authoritarian Accountability

• "Sources of Authoritarian Responsiveness: A Field Experiment in China" by Jidong Chen, Rochester University; Jennifer Pan, Stanford University and Yiqing Xu, Massachusetts Institution of Technology  
• “Political Resource Curse under Authoritarianism: Evidence from China, ” by Ting Chen and James Kai-sing Kung, Hong Kong University of Science and Technology
• “The Institutional Causes of China’s Great Famine, 1959-1961" by Nancy Qian, Yale University
• General discussion by Daniel Treisman, UCLA
• Wrap-Up and Looking Ahead with Chong-En Bai and Susan Shirk

Socialism/Capitalism with Chinese Characteristics

“Crony Capitalism with Chinese Characteristics” (PDF)
Chong-En Bai, Tsinghua University
Abstract: We propose three key features of Chinese capitalism as the institutional foundation of the fast- growing economy of China over the last two decades.

“The Communist Party, the Private Entrepreneur, and the Law:  Theory and Evidence from China”
Chenggang Xu, University of Hong Kong
Abstract: This paper studies the behavior of an authoritarian ruling party theoretically and empirically.

Political Selection and Mobility

“Career Concerns, Beijing Style”
Jiahua Che, Chinese University of Hong Kong
Abstract: We study a model of overlapping principal-agent problems, where one of yesterday’s agents would be selected/promoted as today’s principal, who then wields absolute power free of checks and balances, and has discretion over how to select/promote one of today’s agents as tomorrow’s principal.

“Shocks, Skills, and Political Stability in Authoritarian Regimes: A Theoretical Analysis”
Victor Shih, UC San Diego
Abstract: Why do dictators appoint lieutenants to positions of power, only to purge them a few years later?  If the lieutenants were so threatening to the dictators, why appoint them in the first place? In other words, what changes between the time of appointment and the time of the purge which compels dictators to carry out bloody purges of their lieutenants?  This paper introduces a theoretical account, which explains why dictators need to appoint capable lieutenants and why their subsequent rise to power may compel dictators to purge them.  

“Social Mobility and Revolution: The Impact of the Abolition of China's Civil Service Exam System” (PDF)
Ruixue Jia, UC San Diego
Abstract: This paper studies how perceived social mobility affects participation in revolution using the case of the abolition of China's civil exam system that lasted over 1,300 Years and served as a primary way of creating a gentry class.

Governance and Growth

“Logrolling Under Fragmented Authoritarianism: Theory and Evidence from China” (PDF)
Yuan Li, University of Duisburg-Essen
Abstract: Logrolling or trading of favors among vertical bureaucratic systems in China has been extremely under researched in the existing literature. This paper develops a formal model to study the effect of logrolling on policy making.

“Will China Escape the Middle-income Trap? Politico-economic Theory of Growth and State Capitalism” (PDF)
Yikai Wang, University of Zurich
Abstract: Is China’s rapid growth sustainable if the current labor and capital market distortions persist? Will democratization occur given that Chinese middle-class are supportive of the regime now? To answer the above questions, this paper proposes a politico-economic theory.

Authoritarian Accountability

"Sources of Authoritarian Responsiveness: A Field Experiment in China" (PDF)
Jidong Chen, Rochester University; Jennifer Pan, Stanford University and Yiqing Xu, Massachusetts Institution of Technology
Abstract: Responsiveness may stem from rules of the institutionalized party regime, citizen engagement and a strategy of preferential treatment of a narrow group of supporters. We test the implications of our theory using an online experiment among 2,103 Chinese counties.

“Political Resource Curse under Authoritarianism: Evidence from China” (PDF)
Ting Chen and James Kai-sing Kung, Hong Kong University of Science and Technology
Abstract: Our findings highlight just how land revenue windfall has unwittingly undermined the effectiveness of the promotion system for government officials in a highly politically centralized authoritarian regime, resulting in political resource curse.

“The Institutional Causes of China’s Great Famine, 1959-1961" (PDF)
Nancy Qian, Yale University
Abstract: This paper studies the causes of China’s Great Famine, during which 16.5 to 45 million individuals perished in rural areas.

Chong-en Bai on Xi Jinping's leadership, and what the West gets wrong on the Hong Kong protest

Chang-Tai Hsieh on economic reform and corruption in China