上海模式嗎

new left review 65 sept oct 2010 63 joel andreas A SHANGHAI MODEL? A mong those who muster the most righteous indignation against governments that stifle private enterprise are free- market advocates claiming to speak on behalf of the poor. In their works, the poverty of peasants and of rural migrants who eke out a living in the global South’s growing cities is caused by gov- ernment bureaucrats, who provide privileges for crony capitalists and other favoured elites while smothering the entrepreneurial energies of the less fortunate. Give the poor clearly defined rights to their meagre properties, provide them with opportunities to obtain credit and stop subjecting them to onerous taxes and regulations, and they will not only find entrepreneurial solutions to their own poverty, but they will become a powerful engine for economic development. This is the message of Capitalism with Chinese Characteristics, the widely acclaimed book by Huang Yasheng.1 In contrast to many mainstream economists, who praise China for steadily advancing toward Western capitalist practices over the last three decades, Huang argues that China started retreating from true economic liberalization in the 1990s. In the 1980s, he writes, China was developing a type of entrepreneurial capitalism in which small rural entrepreneurs played the leading role. But in the 1990s it moved toward a state-led capitalism, which favours big government-connected urban enterprises. Huang’s book, which has received considerable attention in academic and policy circles both inside and outside China and was named by the Economist as Book of the Year, has broken new ground in combining free-market doctrines with populist claims. On Capitalism with Chinese Characteristics 64 nlr 65 Most advocates of greater economic liberalization in China are not espe- cially concerned about growing income inequality or about the welfare of those in the lower echelons of the economic hierarchy, but Huang belongs to a distinct subgroup of free-market enthusiasts who place the plight of workers and peasants at the centre of their analyses.2 Members of this subgroup, which includes prominent academics and journalists such as He Qinglian, Hu Shuli, Qin Hui and Kate Zhou, have elaborated a variety of arguments that attribute growing inequality in China to such factors as official corruption, the persistence of state ownership, over- weening government control, constraints on private enterprise, urban bias among state elites, lack of transparency and crony capitalism. Huang’s account has received particular attention for several reasons. First, he is ensconced at the top of the academic establishments on both sides of the Pacific. A native of China who earned a PhD in government at Harvard, Huang now teaches at mit’s Sloan School of Management and has appointments at Tsinghua University’s Center for Chinese Economic Research and Center for China in the World Economy, which house many of the prc’s most prominent and influential economists. Second, he challenges standard accounts of steady progress of market reforms in China by arguing that the conspicuous decline of rural enterprise has been caused by growing state constraints on private entrepreneurship, crafting a narrative that is at once provocative and seemingly intuitive. Third, as a champion of indigenous Chinese enterprise, he criticizes policies that favour foreign-invested firms. Fourth, he backs up his nar- rative with an impressive body of original research. Drawing on intensive examination of thousands of pages of primary documents from Chinese banks and rural credit cooperatives, as well as data from official surveys of rural enterprise that have been little used by academics, Huang pro- duces a wide array of statistics which he analyses in innovative ways. For this, future scholars will be greatly in his debt. The book is organized around a comparison of the 1980s, which Huang characterizes as a ‘rural entrepreneurial decade’, and the 1990s, which he 1 Yasheng Huang, Capitalism with Chinese Characteristics: Entrepreneurship and the State, Cambridge 2008. 2 It is quite common, of course, for academics and journalists casually to suggest that the difficulties faced by China’s workers and peasants are a consequence of the government’s failure fully to carry out market reforms. It is less common to encounter scholars, like Huang, who make this theme the centre of completely elaborated scholarly analyses. andreas: China 65 dubs a ‘state-led urban decade’. In the 1980s, Huang contends, economic policy was largely in the hands of Zhao Ziyang, Wan Li and others who were inclined to carry out liberal experiments and were sympathetic to rural entrepreneurs. After dismantling the rural communes, they allowed private enterprise to flourish in the countryside by removing govern- ment constraints and providing easy access to credit. While the cities were still dominated by sluggish government planning and state-owned enterprises, in the countryside—where the state had always been weaker and enterprising spirit stronger—small labour-intensive rural busi- nesses became the prime engine of the rapidly expanding economy. The liberalizing trends of the 1980s, however, ended abruptly with the suppression of the Tiananmen protests and the fall of Zhao Ziyang in 1989. Economic policy-making was taken over by a new team led by Jiang Zemin and Zhu Rongji, urban-oriented technocrats from Shanghai, who were partial to state-guided industrial planning. They disdained rural entrepreneurs and favoured big, high-tech, capital- and energy-intensive projects, funnelling money to state-owned enterprises and using tax breaks to encourage foreign investment. The result was an increasingly corrupt, crony capitalism and an urban boom in which gleaming sky- scrapers were built on confiscated paddy fields. Starved of credit, rural enterprises stagnated and declined. Huang dedicates one chapter to Shanghai, which he presents as the epitome of all that is wrong with the state-led urban model. While gdp growth has been rapid, he writes, the city’s economic development has been dominated by corporations in which government entities or for- eign companies have major shares, rather than by indigenous private enterprises. To ensure the profitability of the state-connected enter- prises, layoffs of state-sector workers were particularly aggressive and the development of private-sector competition was suppressed. As a result, Shanghai has relatively few small proprietors and a dearth of medium and large private firms. This lopsided development has in Huang’s view produced income polarization, with the city’s poorest resi- dents experiencing falling real incomes. Huang doubts the sustainability of China’s state-led development model, citing growing corruption, recurring asset bubbles and slowing total-factor productivity growth. In the final chapter, he compares the Chinese model unfavourably with those pursued by other East Asian 66 nlr 65 countries and India. The latter is now also on a rapid development trajectory, he writes, because it has replaced economic planning with a liberal policy environment that nurtures indigenous private entre- preneurship (as China did in the 1980s). Among China’s East Asian neighbours, although Japan, Taiwan and South Korea all pursued industrial policy approaches in the past, even when the state was most involved in guiding development the private sector was always predomi- nant. Moreover, like India, these countries did not depend on foreign investment. All of them, Huang concludes, are private-sector success stories, in which indigenous entrepreneurs played the key role. Huang’s most striking argument concerns not development, but rather inequality. While China’s economy grew rapidly during both the 1980s and the 1990s, he contends, distribution was far more equitable under the rural entrepreneurial model than under the state-led urban model. In the 1980s, personal income grew faster than gdp and rural incomes grew faster than urban incomes. Not only were both trends reversed in the 1990s, but education and medical care became increasingly unaf- fordable to rural residents, leading to a decline in rural literacy and health indices. The book’s take-home message: when the Chinese government was smart enough to get out of the way and let private enter- prise flourish, the economy not only grew rapidly, but the results were more equitable. In this essay, I will consider the main empirical ques- tions underlying these claims. First, why did rural enterprises in China flourish in the 1980s and then falter in the 1990s? Second, what caused economic inequality to grow so rapidly in the 1990s? Rural enterprises The actual causes of the rise and fall of rural enterprises are in some ways just the opposite of what Huang proposes. Small rural firms flour- ished in the 1980s not because the state got out of the way, but rather because it intervened in the economy in a heavy-handed fashion in order to prevent the development of larger private enterprises. In the early years of the post-Mao era, the Chinese Communist Party was deter- mined to prevent the development of a capitalist sector, which it viewed as a potential political threat. It allowed rural households to engage in small-scale entrepreneurial activities, and it continued to promote the development of collective enterprises run by village and township offi- cials. Both sectors flourished with the opening of commodity markets, andreas: China 67 but their success was due in large measure to government protection. The state, in effect, created and maintained an environment in which these enterprises could operate without facing competition from large capitalist firms. This protection took six key forms: 1. Land reform and rural collectivization, carried out at the begin- ning of the communist era, had eliminated the old landed and business classes, and decollectivization subsequently divided land equally among rural households. The field had been cleared and when markets were opened up in the early 1980s, there was plenty of room for entry by small rural entrepreneurs. 2. The ccp suppressed the development of new capitalist firms. Households were permitted to engage in business, but they could not legally employ more than seven people (nominally family members). This restriction was lifted only after 1987. 3. Strict limits on the sale and leasing of land further inhibited the development of larger private enterprises. 4. While contracting with foreign firms was encouraged, direct investment by foreign capitalists was severely restricted. 5. The domestic market remained by and large protected from imported goods. 6. Rural households and collective enterprises enjoyed a monopoly on employing inexpensive rural labour (which was subsidized by subsistence farming). Urban state-owned enterprises were com- pelled to provide permanent employment and generous welfare benefits to their incumbent workers, and the employment of temp- orary workers was restricted. This gave small rural enterprises an advantage in labour-intensive sectors, and many benefited from subcontracting relations with state enterprises. The rural economic boom of the 1980s was powered largely by small fac- tories owned by township and village governments (which were known as collective enterprises, although they were not actually owned by their employees). Small household enterprises also flourished, and by the end of the decade, as employment limits and other restrictions were eased, 68 nlr 65 private entrepreneurs began to build larger businesses. In order to claim that the rural take-off in the 1980s was largely a private-sector affair, Huang downplays the role of enterprises owned by township and village governments and exaggerates the role of the private sector. To bolster his argument, he cites Ministry of Agriculture data showing that the great majority of rural enterprises were private, rather than collective. This is true if we count all self-employed individuals as ‘enterprises’, because in that case the great majority of enterprises were simply individual artisans, peddlers and shopkeepers. The bulk of employment, however, was actually provided by the collective enterprises, which were fewer in number but significantly larger.3 According to the Ministry of Agriculture data compiled by Huang, reproduced below as Table 1, in the late 1980s, ‘household businesses’ (getihu) made up over 80 per cent of all rural enterprises, but the aver- age number of people active in each of these businesses was only about two. The number of larger private enterprises (those with more than seven employees) was growing, but they were also relatively small, with an average of only about eight employees per enterprise, and until the mid-1990s they never provided more than 10 per cent of employ- ment in the rural entrepreneurial sector. On the other hand, although collective enterprises were relatively small in number, they employed many more people (an average of about thirty per enterprise by the end of the 1980s), and they accounted for over half of the employment in this sector. If we were to remove from this calculation those busi- nesses that were simply self-employed individuals, then the collective sector provided the overwhelming majority of jobs. Moreover, the col- lective enterprises dominated manufacturing, which was the engine of the rural take-off, while small household businesses were concentrated in transportation, commerce and services, and many of them benefited from opportunities provided by the growth of the collective factories. Nevertheless, Huang is right to characterize rural China in the 1980s as highly entrepreneurial. All rural businesses, including the factories run by township and village cadres, operated outside of the state plan and 3 Some enterprises that registered as collectives were actually privately run, but there is no evidence that these comprised more than a small proportion of the total, and Huang does not suggest that they did. Moreover, it seems that such false registration was largely a phenomenon of the late 80s and early 90s, after the establishment of larger private enterprises had been endorsed ideologically and gained legal sanction, but collective enterprises continued to enjoy credit and other preferences. andreas: China 69 had to be enterprising. And all kinds of rural enterprises—household, collective and small-scale capitalist—flourished in the hothouse environ- ment created by the policies of the first decade of market reforms. So, what changed in the 1990s? The key difference was that the ccp began to promote large-scale capi- talist enterprise. In order to compete in global markets, Deng Xiaoping decided, China had to develop large enterprises that operated on capitalist principles. After Deng’s famous 1992 Southern Tour, when he praised the efficiency of export-oriented foreign-invested firms in China’s special economic zones, the state stopped suppressing and instead encouraged the development of large private enterprises, foreign and domestic. The new Company Law that came into effect in 1994, together with a series of *More than seven employees. Source: Huang, Capitalism with Chinese Characteristics, p. 79. Year Total Collective Large Private* Household Total Collective Large Private* Household 1985 12.2 1.57 0.53 10.1 69.8 41.5 4.75 23.5 1986 15.2 1.73 1.09 12.3 79.4 45.4 8.34 25.6 1987 17.5 1.58 1.19 14.7 88.1 47.2 9.23 31.6 1988 18.9 1.59 1.2 16.1 95.5 48.9 9.77 36.8 1989 18.7 1.53 1.07 16.1 93.7 47.2 8.84 37.6 1990 18.7 1.45 0.98 16.3 92.7 45.9 8.14 38.6 1991 19.1 1.44 0.85 16.8 96.1 47.7 7.27 41.2 1992 20.9 1.53 0.90 18.5 106.3 51.8 7.71 46.8 1993 24.5 1.69 1.04 21.8 123.5 57.7 9.14 56.6 1994 24.9 1.64 0.79 22.5 120.2 58.9 7.3 53.9 1995 22.0 1.62 0.96 19.4 128.6 60.6 8.74 59.3 1996 23.4 1.55 2.26 19.6 135.1 59.5 24.6 50.9 1997 20.1 1.29 2.33 16.5 130.5 53.2 26.3 51.0 1998 20.0 1.07 2.22 16.8 125.4 48.3 26.2 50.9 1999 20.7 0.94 2.08 17.7 127.1 43.7 28.5 54.8 2000 20.9 0.8 2.06 18.0 128.2 38.3 32.5 57.3 2001 21.2 0.67 2.01 18.5 130.9 33.7 36.9 60.2 2002 21.3 0.73 2.3 18.3 132.9 38.0 35.0 59.8 Table 1. Ownership of Township and Village Enterprises, 1985–2002 Number of tves, million units Employment in tves, million persons 70 nlr 65 related reforms, constituted a major shift toward more liberal economic policies, opening the way for the development of a private corporate sector and the privatization of the great majority of state-owned and collective enterprises. As a result, the protective environment that rural enterprises had enjoyed in the 1980s was dismantled. Huang is right to argue that urban bias was involved in the decline of China’s rural economy in the 1990s, but he misconstrues the source of this bias. Capitalism intrinsically has an urban bias. With the devel- opment of capitalism, peasants, peddlers and artisans are displaced by capitalist firms, the size of enterprises increases, the centre of economic activity shifts from the countryside to cities, peasants move to urban areas and cities expand at the expense of the countryside. Large capitalist enterprises are headquartered in cities, and successful rural enterprises move to cities as they grow. Jiang Zemin and Zhu Rongji did, indeed, have an urban bias, but it was inherent in their preference for capital- ism. They were inspired by the corporate capitalism of the West, and they favoured supermarkets over farmers’ markets, department stores over street vendors, large factories over small ones, and corporate chains over mom-and-pop businesses. They had little use for township and village enterprises or household businesses; they wanted to see large, well-capitalized and technologically advanced corporations that were well integrated into global markets. In general, they favoured private over public, and they forced the complete privatization of the great majority of state-owned and collective enterprises, and the partial privatization of most others. The state held onto control of enterprises in a few ‘strategic’ sectors, including banking, oil and other key resources, power, telecom- munications and armaments; but even in these sectors enterprises were restructured so that they were responsible for their own profits and losses, which meant they had to act more like capitalist corporations. The labour market was also liberalized. Restructured public enter- prises were freed from obligations to their employees; they no longer had to provide health insurance, pensions, housing, childcare or other welfare services, and they were now free to hire and fire according to market requirements. Private enterprises were allowed to take on as many employees as they wanted, and all enterprises could now freely hire rural migrants. At the same time, the establishment of large private enterprises was now permitted and successful entrepreneurs—urban and rural—were able to get bank loans to expand their operations. andreas: China 71 Restrictions on foreign direct investment were lifted, and capital poured in from multinational corporations in the United States, Japan, South Korea and Europe, as well as from a multitude of capitalists, large and small, of Chinese ethnic origin in Hong Kong, Taiwan and Southeast Asia. Zhu Rongji reorganized the regulatory structure so that it more closely conformed to Western practices; his declared goal was to cre- ate a ‘level playing field’ for all types of enterprises, public and private. Although some state enterprises still get preferences, the private corpo- rate sector is expanding rapidly, and profitable private busine