“Laboratory nationalism”: Policy innovation in China

Jinbao Qian and Linmu Li

Socio-Economic Planning Sciences, 2024, vol. 92, issue C

Abstract: The central government and local governments in China constitute “laboratory nationalism”, which is different from “laboratory federalism”. As a planner, the central government first organizes small-scale policy trials, then imitates the successful policies on a larger scale. To illustrate the process, we take the gradual regional opening as a typical case, then develop a two-stage “trial-extension” game model incorporating the central government and two local governments. Laboratory nationalism's domination depends on actions of the central government at two stages: (1) offering proper incentives to the eligible district at the beginning; (2) in the end unifying local policies to the one which has proven to be successful. We demonstrate that under certain conditions, laboratory nationalism can improve on decentralized outcome.

Keywords: Laboratory nationalism; Policy innovation; Two-stage game (search for similar items in EconPapers)
JEL-codes: C72 O21 O35 (search for similar items in EconPapers)
Date: 2024
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Persistent link: https://EconPapers.repec.org/RePEc:eee:soceps:v:92:y:2024:i:c:s0038012124000521

DOI: 10.1016/j.seps.2024.101853

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