Politics, growth, and inequality in rural China: Does it pay to join the Party?

Jonathan Morduch, Terry Sicular

Research output: Contribution to journalArticle

Abstract

Economic reform is often constrained because rank-and-file bureaucrats responsible for implementation have vested interests that oppose change. Drawing on an unusual longitudinal survey data set for a representative rural county in northern China, we show an alternative, positive scenario consistent with the presence of an implicit, performance-based incentive contract that ties the household incomes of local officials to market liberalization, increases in consumer demand, and the provision of local public goods. The mechanisms appear to be tolerated as the fruits of growth are shared fairly equitably, thus allowing implementation of a politically and economically self-reinforcing reform process.

Original languageEnglish (US)
Pages (from-to)331-356
Number of pages26
JournalJournal of Public Economics
Volume77
Issue number3
DOIs
StatePublished - Sep 2000

Keywords

  • China
  • D31
  • Economic transition
  • Inequality
  • P21
  • P26
  • Political economy
  • Rural reform

ASJC Scopus subject areas

  • Finance
  • Economics and Econometrics

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