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The Oxford Companion to the Economics of China$
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Shenggen Fan, Ravi Kanbur, Shang-Jin Wei, and Xiaobo Zhang

Print publication date: 2014

Print ISBN-13: 9780199678204

Published to Oxford Scholarship Online: December 2014

DOI: 10.1093/acprof:oso/9780199678204.001.0001

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Economic institutions and their impacts on firm strategies and performance

Economic institutions and their impacts on firm strategies and performance

(p.273) 43 Economic institutions and their impacts on firm strategies and performance
The Oxford Companion to the Economics of China

Julan Du

Yi Lu

Zhigang Tao

Oxford University Press

This chapter examines regional variations in China’s economic growth. It shows that, in addition to factors such as internal and external market integration and incentive motivation, economic institutions are important for economic growth in China by casting significant impacts on firm strategies and performance. The chapter suggests that China’s economic development could be concentrated in those regions where institutions are reasonably good, or concentrated among industries for which institutions are less important, thereby negating the so-called China puzzle. It hypothesizes that China would have grown even more rapidly and healthily if it had better economic institutions.

Keywords:   regional economy, regional variations, economic growth, Chinese economy, property rights protection, contact enforcement, firm performance

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