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When Chinese leaders announced in late 1978 that China would "open to the outside world," they embarked on a strategy for attracting private foreign capital to spur economic development. At the same time, they were concerned about possible negative repercussions of this policy. Margaret Pearson examines government efforts to control the terms of foreign investment between 1979 and 1988 and, more broadly, the abilities of socialist states in general to establish the terms of their own participation in the world economy. Drawing on interviews with Chinese and foreigners involved in joint ventures, Pearson focuses on the years from 1979 through 1988, but she also comments on the fate of the "open" policy following the economic retrenchment and political upheavals of the late 1980s. "Since the policy of `opening' was launched in Beijing in 1979 some Chinese leaders have favoured foreign investment, while others have feared that it would carry ideas and institutions that would corrupt Chinese socialism. This study of Chinese policies toward foreign-invested enterprises (FIFs) during the 1980s broadly charts significant changes in the impact of these competing views on policy. . . . Pearson's overview and analysis provide thought-provoking perspectives. . . . Pearson furnishes excellent evidence that throughout the 1980s the pressure for reform was so great that the conservatives had to retreat repeatedly, despite their concerns about the decline of collectivist values and the Maoist dream."--Stanley Lubman, The China Quarterly.

When Chinese leaders announced in late 1978 that China would "open to the outside world," they embarked on a strategy for attracting private foreign capital to spur economic development. At the same time, they were concerned about possible negative repercussions of this policy. Margaret Pearson examines government efforts to control the terms of foreign investment between 1979 and 1988 and, more broadly, the abilities of socialist states in general to establish the terms of their own participation in the world economy. Drawing on interviews with Chinese and foreigners involved in joint venture

The study of Chinese foreign policy has long shown that domestic politics and domestic constraints are sources of foreign policy, albeit generally considered less potent than ideology and interests. Domestic political constraints should also be explored as factors in Chinese regional policies toward East Asia, including regional economic institutions. This paper examines three domestic institutional constraints on regional foreign policy in the area of trade and economics: a fragmented decision-making structure that has difficulty with coordination, a relatively heavy reliance on top level decision-makers at a time when issues of Asian economic policy have relatively low priority for these same decision-makers, and the relatively extreme lack of autonomy for negotiators vis-aacute-vis top decision-makers in Beijing. These constraints are by any means unique to China. However, at a time when many observers and participants are expecting-indeed, often hoping for-Chinese leadership in the region, the paper posits that these constraints hinder the PRC's ability to fill this role. The key empirical focus is regional trade agreements and regional economic organizations. (J Contemp China/GIGA)

Pursuant to its extensive program of market reforms, China's government tried to restructure itself to support a market‐dominated economy. Reform efforts have included elements that are familiar to scholars of public administration: streamlining government, strengthening bureaucratic capacity, distancing government from firms, and establishing independent regulators. But how deep have these reforms been, and with what ultimate goals? This article examines a crucial segment of the economy—China's so‐called lifeline industries—to show how reforms to China's economic governance system have been mapped onto an existing system characterized by extreme institutional fragmentation and an inability to imbue new governmental bodies with authority. Moreover, for these key industrial sectors, the Chinese party‐state's strong interests in ownership, revenues, and social policy dictate that it use a variety of tools to protect these interests.

China began to establish markets a quarter century ago, but only in the last decade has its government made a concerted effort to design new institutions to govern them. Hence, a "regulatory state" is emerging. The prevailing literature focuses on a seeming convergence of Chinas institutions with the dominant global model of the "independent regulator," including the establishment of new regulatory commissions. Yet research on China's strategic industries—those in the infrastructure and financial services sectors—suggests that assumptions of convergence obscure key elements of a regulatory design characterized by continued state ownership (as opposed to privatization), maximization of the value of these assets, and active government structuring of these industries. Moreover, regulators in the existing party-state bureaucracy have relatively weak authority. This research cautions us to rethink dominant models of Chinese political economy so that we retain a place for the central state in directing market reform at the "commanding heights" of the economy.