China's Gilded Age The Paradox of Economic Boom and Vast Corruption

274 Pages·2020·5.677 MB·English

by  Yuen Yuen Ang

CHINA’S GILDED AGE
WhyhasChinagrownsofastforsolongdespitevastcorruption?InChina’s
Gilded Age, Yuen Yuen Ang argues that not all types of corruption hurt
growth, nor do they cause the same kind of harm. Ang unbundles
corruptionintofourvarieties:pettytheft,grandtheft,speedmoney,and
accessmoney.Whilethefirstthreetypesimpedegrowth,accessmoney
elite exchanges of power and profit cuts both ways: it stimulates
investment and growth but produces serious risks for the economy and
political system. Since market opening, corruption in China has evolved
towardaccessmoney.Usingarangeofdatasources,theauthorexplains
theevolutionofChinesecorruption,howitdiffersfromtheWestandother
developingcountries,andhowXi’santicorruptioncampaigncouldaffect
growth and governance. In this formidable yet accessible book, Ang
challenges onedimensional measures of corruption. By unbundling the
problem and adopting a comparativehistorical lens, she reveals that the
riseofcapitalismwasnotaccompaniedbytheeradicationofcorruption,
but rather by its evolution from thuggery and theft to access money. In
doingso,shechangesthewaywethinkaboutcorruptionandcapitalism,
notonlyinChinabutaroundtheworld.
YuenYuenAngisAssociateProfessorofPoliticalScienceattheUniversity
ofMichigan.HerbookHowChinaEscapedthePovertyTrap(2016)received
the Peter Katzenstein Book Prize in Political Economy and the Viviana
Zelizer Book Award in Economic Sociology. She has been named an
Andrew Carnegie Fellow for “highcaliber scholarship [on] some of the
most pressing issues of our times.” In addition, she has received grants,
fellowships, and an essay prize from the American Council of Learned
Societies,AndrewW.MellonFoundation,ChiangChingKuoFoundation,
and Gates Foundation. Her commentaries and interviews have appeared
on the BBC and CGTN, and in Foreign Affairs, The New York Times, Project
Syndicate,TheWallStreetJournal,andmediaoutletsaroundtheworld.

CHINA’S GILDED AGE
The Paradox of Economic Boom and Vast
Corruption
Yuen Yuen Ang
UniversityofMichigan,AnnArbor
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www.cambridge.org
Informationonthistitle:www.cambridge.org/9781108478601
DOI:10.1017/9781108778350
©YuenYuenAng2020
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Contents
ListofFigures . . . . . . . . . . . . . . . . . . . . . . . . . . . . pageviii
ListofTables . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . xi
Acknowledgments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . xiii
1 Introduction:China’sGildedAge . . . . . . . . . . . . . . . . . 1
2 UnbundlingCorruptionacrossCountries . . . . . . . . . . . 23
3 UnbundlingCorruptionoverTime . . . . . . . . . . . . . . . 52
4 Profit-Sharing,ChineseStyle . . . . . . . . . . . . . . . . . . . 85
5 CorruptandCompetent . . . . . . . . . . . . . . . . . . . . . 119
6 AlltheKing’sMen . . . . . . . . . . . . . . . . . . . . . . . . 153
7 RethinkingNineBigQuestions . . . . . . . . . . . . . . . . . 180
Appendix . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 213
References . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 232
Index . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 249
vii
Figures
1.1 CorruptionandGDPpercapita. . . . . . . . . . . . . . . . . . . . page3
1.2 Chinaasa“giganticoutlier”visàvistheUnitedStates. . . . . . . . . . 4
1.3 Unbundlingcorruptionintofourtypes. . . . . . . . . . . . . . . . . . 9
2.1 TotalandunbundledUCIscoresinonevisual. . . . . . . . . . . . . 33
2.2 UCIscoresandranksbycountry. . . . . . . . . . . . . . . . . . . . . 33
2.3 ComparingtheUCIandCPIranks. . . . . . . . . . . . . . . . . . . . 34
2.4 ComparingtheUCIandoverallperceptionscores. . . . . . . . . . . 36
2.5 Chinavs.Russia’sUCIscores. . . . . . . . . . . . . . . . . . . . . . . 39
2.6 Chinavs.India’sUCIscores. . . . . . . . . . . . . . . . . . . . . . . . 41
2.7 Chinavs.theUnitedStates’UCIscores. . . . . . . . . . . . . . . . . 44
2.8 UCIscoresandincomelevelsarenegativelycorrelated. . . . . . . . 47
2.9 Allrichcountriesarelowinspeedmoneybutnotinaccessmoney. . 48
3.1 BannerinShenzhen,showingDengXiaopingandthewords
“StickfirmlytotheParty’sfundamentalpathfor100years.” . . . . . 58
3.2 PresidentBillClintonlistensasChinesePremierZhuRongji
makesastatementontheSouthLawnoftheWhiteHouse
in1999. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 60
3.3 Landproceedsfinancedaninfrastructureboominthe2000s,
includinghighspeedrail,asseenhereinHangzhou. . . . . . . . . . 63
3.4 ChinesePresidentXiJinpingandothertopleaders.Onthe
farrightisWangQishan. . . . . . . . . . . . . . . . . . . . . . . . . . 66
3.5 Corruptioncasesinvolvedlargersumsovertime. . . . . . . . . . . . 70
3.6 Corruptionwithexchangeexplodedbutcorruptionwiththeft
shrank. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 72
3.7 Briberyrosewhileembezzlementandmisuseoffundsdeclined. . . . 73
3.8 Briberytookupagrowingshareofcorruptionovertime. . . . . . . . 74
viii
LISTOFFIGURES
3.9 Comparisonofbriberyandembezzlementtrendsbymonetary
value. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 74
3.10 Comparisonofbriberyandembezzlementbyrankofofficials
involved. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 75
3.11 Mediamentionsoftransactionalcorruption,byyearandterm,
1988 2012. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 79
3.12 Mediamentionsofnontransactionalcorruption,byyear
andterm,1988 2012. . . . . . . . . . . . . . . . . . . . . . . . . . . . 81
4.1 Zouping,oneofthe136countiesinShandongprovincewhere
Ididresearch. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 99
4.2 Fringecomponentsmadeup76percentofcompensation. . . . . . . 100
4.3 Fringecompensationvariedfarmorewidelythanformalwages. . . . 101
4.4 Growthoffringecompensationoutpacedformalwages. . . . . . . . 103
4.5 Totalbureaucraticincomeexceededaverageurbanwages. . . . . . . 103
4.6 Increasingagencycollectionswasmorerewardinginthe
shortterm. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 108
4.7 Expandingthetaxbasewasmorerewardinginthelongterm. . . . . 108
5.1 MediacoverageofBoXilaibeforeandafterhisfall. . . . . . . . . . . 122
5.2 MediacoverageofJiJianyebeforeandafterhisfall. . . . . . . . . . . 124
5.3 BoXilaiissurroundedbyreporterswhenarrivingatthe11th
NationalPeople’sCongressinBeijingin2010. . . . . . . . . . . . . . 125
5.4 Chongqing’seconomysurpassedthenationalaverageunderBo. . . 128
5.5 DuringBo’stenure,Chongqingsawarapidconstructionboom. . . . 129
5.6 Chongqing’seconomicboomwasheavilydrivenbyinvestment. . . . 131
5.7 Chongqing’sdebttoGDPratiokeptrising. . . . . . . . . . . . . . . 132
5.8 Inthisscreenshot,JiJianyestandstrialatacourtfortakingbribes. . 136
5.9 JiJianyestrategicallybrandedYangzhouasablendofancient
cityandmoderncivilization. . . . . . . . . . . . . . . . . . . . . . . . 138
6.1 AnanticorruptionexhibitioninZhejiang,featuringvideos
ofXiJinping,artwork,andposters. . . . . . . . . . . . . . . . . . . . 155
6.2 Posteronthe“eightpointregulations,”includingrestrictionsagainst
gambling,Internetsurfing,banqueting,anddrinkingatwork. . . . . 158
6.3 WavelikehazardrateoffallamongcityPartysecretaries. . . . . . . . 166
6.4 Effectsofpatron’sfalloncityleaders’likelihoodoffall. . . . . . . . 172
6.5 Fallsofnationalandlocalofficialssince2013. . . . . . . . . . . . . . 174
ix