IDEAS home Printed from https://ideas.repec.org/a/aka/aoecon/v69y2019i1p1-16.html
   My bibliography  Save this article

The Pitfalls of a Centralized Bureaucracy

Author

Listed:
  • Chenggang Xu

    (Cheung Kong Graduate School of Business, China
    Center for AI and Institutions at CKGSB, Beijing, China)

Abstract

The incentive problem is a vital issue in all transition economies and China is not an exception. This paper summarises how China partially solved this problem at early stages of post-Mao reforms and why the Chinese solution is only transitory, which explains severe problems that China is facing now. The paper also discusses the incentive mechanisms in the judicial system and the effect of the soft budget constraint (SBC) syndrome on incentives, including the relationship between institutions and innovation.

Suggested Citation

  • Chenggang Xu, 2019. "The Pitfalls of a Centralized Bureaucracy," Acta Oeconomica, Akadémiai Kiadó, Hungary, vol. 69(1), pages 1-16, March.
    • Handle: RePEc:aka:aoecon:v:69:y:2019:i:1:p:1-16
    Note: Based on the speech for receiving the 2016 China’s Economics Prize.
    as

    Download full text from publisher

    File URL: http://www.akademiai.com/doi/pdf/10.1556/032.2019.69.1.1
    Download Restriction: subscription
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. János Kornai, 2019. "Frankenstein's Moral Responsibility," Acta Oeconomica, Akadémiai Kiadó, Hungary, vol. 69(4), pages 485-494, December.
    2. Péter Mihályi & Iván Szelényi, 2021. "Kornai on the affinity of systems: Is China today an illiberal capitalist system or a communist dictatorship?," Public Choice, Springer, vol. 187(1), pages 197-216, April.
    3. Li, Weijia & Roland, Gérard & Xie, Yang, 2022. "Crony capitalism, the party-state, and the political boundaries of corruption," Journal of Comparative Economics, Elsevier, vol. 50(3), pages 652-667.

    More about this item

    Keywords

    incentives; bureaucracy; Chinese economy; soft-budget constraints; R&D; law enforcement; incomplete law;
    All these keywords.

    JEL classification:

    • D02 - Microeconomics - - General - - - Institutions: Design, Formation, Operations, and Impact
    • D73 - Microeconomics - - Analysis of Collective Decision-Making - - - Bureaucracy; Administrative Processes in Public Organizations; Corruption
    • G20 - Financial Economics - - Financial Institutions and Services - - - General
    • G30 - Financial Economics - - Corporate Finance and Governance - - - General
    • H70 - Public Economics - - State and Local Government; Intergovernmental Relations - - - General
    • K20 - Law and Economics - - Regulation and Business Law - - - General
    • K29 - Law and Economics - - Regulation and Business Law - - - Other
    • O30 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - General
    • P30 - Political Economy and Comparative Economic Systems - - Socialist Institutions and Their Transitions - - - General

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:aka:aoecon:v:69:y:2019:i:1:p:1-16. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Kriston, Orsolya (email available below). General contact details of provider: https://akademiai.hu/ .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.