Enfranchising Private Entrepreneurs: The Unintended Consequences of Party Building among China’s Industrialists

• In Event: 118 - Section on Economic Sociology Refereed Roundtable Session and Business Meeting
  In Refereed Roundtable 60min: Table 02. The Chinese State and Social Dynamics of Entrepreneurship

Abstract

A national policy calling for rapid development demands that the central state has the capacity to swiftly and forcefully steer the economy. In such a polity, rules need to be adaptable to immediate objectives, thus privileging executive discretion and speedy legislation. In an environment where rules can be unstable and private individuals cannot use laws to predict the state’s scope of coercion, market actors rely on informal network ties to resolve regulatory uncertainty—appearing as administrative racketeering, regulatory opacity, and rapid policy changes. Using data collected from eight months of participant observation, I observe that the state has overlaid upon such an institution of multiple dependency among private individuals, a party building project to absorb the private sector via extending political representation and establishing firm party cells. I argue that by organizing private firms within the party apparatus, local state agents and industrialists can now predictably resolve two types of intertwined uncertainties in a one-party state: one arising from the market (i.e., information and capital access) and the other from administrative bodies (i.e., state discretion and regulatory enforcement). An outcome of this arrangement however, is that the Chinese Communist Party’s efforts to augment legitimacy comes at the cost of compromised state capacity to enforce administrative law.

Author

• Tina Ching-Tien Lee, Princeton University