China & World Economy / 136–55, Vol. 21, No. 4, 2013
State Fragmentation and Rights Contestation: Rural Land Development Rights in China
Fubing Su, Ran Tao, Hui Wang*
Abstract
The functionalist reasoning of institutional changes builds on individual rationality and explains institutional changes from the demand side. While insightful, a comprehensive understanding also needs to take into account the supply side. The state, as the ultimate supplier of institutional changes, plays the pivotal role of agency; therefore, its willingness and ability decide how such regime change occurs and what particular form the new regime takes. Since the mid-1990s, the Chinese economy has embarked on a path of rapid industrialization and urbanization. The contestation over rural land development rights in China offers an excellent case to illuminate the importance of state agency in institutional changes. Drawing on case studies in China’s three major urbanizing regions, this article analyzes how villages brought their own land directly to the land market and reaped handsome profits. We argue that the three successful cases, Nanhai in Guangdong, Kunshan in Jiangsu and Zhenggezhuang in Beijing, all represent a product of active agency on the supply side. The Chinese state’s fragmented authority provides a favorable institutional environment for such changes.
Key words: institutional change, land development rights, state agency
JEL codes: H71, K11, P26, R52