Interstitial Emergence and the Origins of China’s Private Economy

• In Event: 115 - Section on Asia and Asian America Refereed Roundtable Session and Business Meeting
  In Refereed Roundtable 60min: Table 06. Research on Economic and Cultural Institutions in China

Abstract

This paper investigates China’s private economy and focuses on its origins—forms of precursor organizations that later became private by retaining their previous private enterprise status or transforming from other ownership forms. Drawing on China’s education and training industry (ETI) and education and training organizations (ETOs) as de facto economic, private and for-profit enterprises, I show that the list of origins identified by the extant literature—state owned enterprises, indigenous private enterprises and hybrid enterprises—is incomplete. I argue that we need a theoretical tool of ‘interstitial emergence’ to systematically capture a general type of origin that starts at the interstices. I propose that interstitial emergence can occur along three major dimensions and that the education and training organizations present a special case sitting on all three dimensions. Extant studies on the size and contributions of China’s private economy, due to their negligence in covering all dimensions and industries such as the ETI, are all understatements. I further explain why interstitial emergence often breeds a vibrant economy and why private enterprises tend to benefit more than state enterprises from interstitial emergence. Finally, I conclude by discussing the limited role of institutions, the non-rural nature of China’s private economy and other methodological implications.

Author

• Le Lin, University of Chicago