The state in Chinese economic history

Abstract

We survey the recent economics and history literature on the Chinese state to investigate its role in China's long‐term socioeconomic development. We highlight three insights. First, unlike in Europe, where interstate competition helped give rise to capitalist states with high capacity, the Chinese state emerged from a different historical context. Second, the 18th‐ and 19th‐century Chinese state does not fit into the mould of a strong and extractive Oriental despotic state as once commonly believed. By conventional measures, early modern China had a weak state. Third, state building and centre‐local relations are two useful dimensions to understand development and change in China's recent history and political economy. To adapt China to a changing world, Chinese state builders embarked on a long process of state building from the late‐19th century through the Republican and Communist eras. Facilitated partly by regional decentralisation, the process now sees the Chinese state playing a substantially larger role in the economy and everyday life than any previous time in history.