This carefully reasoned book seeks to explain why the widespread hope that economic development will lead to political reform in China is probably misplaced. Gallagher attaches great importance to how foreign direct investment has affected labor policies by forcing state-owned enterprises to compete in the labor market. FDI has also compelled the state to make liberal labor reforms and, most important, has shifted attention away from the old socialist debates over public versus private ownership to more nationalist concerns about Chinese interests. Gallagher concludes that this focus on the well-being of Chinese industries in general, both foreign- and state-owned, places a check on any movement toward democracy. This is an original work of political economy, and it should stimulate much productive discussion.