In This Review

Rural China Takes Off: Institutional Foundations of Economic Reform
Rural China Takes Off: Institutional Foundations of Economic Reform
By Jean C. Oi
University of California Press, 1999, 259 pp.
Contesting Citizenship in Urban China: Peasant Migrants, the State, and the Logic of the Market
Contesting Citizenship in Urban China: Peasant Migrants, the State, and the Logic of the Market
By Dorothy J. Solinger
University of California Press, 1999, 399 pp.

These two empirically rich and theoretically provocative studies address the political economy and socio-legal standing of China's huge peasant population, offering surprising sources for much of China's economic dynamism. Oi recounts how peasants became workers in rural industries and their local officials became successful entrepreneurs, organizing "village and township enterprises" (VTEs). Other scholars have told of the economic successes of the VTEs, but Oi's work stands out for its lucid analysis of the theoretical issues of incentives, property rights, and the differences between public and private ownership and management. Under the reforms, local governments and enterprising Communist Party cadres organized industries and managed them as de facto private enterprises. Oi advances the concept of "local-state corporatism" to explain the flourishing of VTEs. By illuminating the logic of these successes, however, she also overlooks the problems of cronyism, corruption, and informal tax collecting that have recently caused considerable rural discontent.

America's leading authority on Chinese internal migration, Solinger reports on the 70 to 100 million peasants who have played critical roles in economic reform as they moved from the countryside to the cities. In all developing countries, the transition from agriculture to industry has produced such movements. But the problem in China has been especially troublesome ever since Mao created a great divide between country and city through a strictly disciplined household registration system (HUKOU). Based on HUKOU, city dwellers could claim generous benefits -- and were quick to see the migrants as a dangerous "floating population" that should be denied citizenship rights. The spread of the free market has not produced a spirit of common citizenship and participation; instead, it has created an atmosphere where urban Chinese anxiously protect their advantages by clinging to features of the old system. These problems are likely to become even more worrisome as the inefficient state-owned enterprises shed millions of jobs held by the once-advantaged urbanites.