Formal and Informal Institutions Explaining China’s Modern Economic Development: Their Historical Roots and Recent Evolution

Mary M. Shirley () and Lixin Colin Xu
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Mary M. Shirley: The Ronald Coase Institute
Lixin Colin Xu: Cheung Kong Graduate School of Business

Chapter 35 in Handbook of New Institutional Economics, 2025, pp 927-952 from Springer

Abstract: Abstract How has China grown so rapidly through private initiatives despite weak institutions enforcing contracts and protecting against expropriation? Why has private investment, after overcoming so many obstacles, stagnated over the last decade? This chapter explores the changing roles of the state and private sectors during China’s history and since the death of Mao in 1979. It analyzes the formal and informal institutions that have enforced contracts and protected against expropriation in China. It concludes with a consideration of the adverse effects of recent changes on China’s private sector and the future trajectory of China’s growth.

Keywords: Property rights; Society capacity; Contract enforcement; Government expropriation; Confucianism; China’s state-owned enterprises (search for similar items in EconPapers)
Date: 2025
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Persistent link: https://EconPapers.repec.org/RePEc:spr:sprchp:978-3-031-50810-3_35

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DOI: 10.1007/978-3-031-50810-3_35

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