Institutional mosaic of financial institutions in the late Qing China and synthesis of organizational forms: from piaohao and qianzhuang to the central bank

Abstract

Objective: to determine the peculiarities of forming the banking system in late imperial China in terms of the interaction between traditional Chinese banking institutions, imported institutional forms, and state reform strategies. Methods: qualitative methods (comparative analysis, generalization), historical and genetic method.Results: based on a wide array of historical data, the history of the Chinese banking system development during the Qin dynasty decline is demonstrated. By the time of the Chinese economy “forced opening” by Western powers during the Opium Wars, China had its own quasi-banking institutions based on the established clan networks of trade organizations that covered the credit needs of the traditional economy. The local development of modern industries in China required modern approaches to the organization of banking activities. The lacuna was filled by foreign banks, which actually monopolized modern banking in China, and later by state-owned banks. It is shown that by the end of the Qing period all three participants of the banking industry – traditional banks, foreign banks and state banks – covered the needs of the Chinese economy. It is concluded that the banking industry of the late imperial period was a mosaic institutional fabric, combining both traditional and westernized elements and embedding clan ties traditional for China.Scientific novelty: the article is the first attempt in Russia to comprehensively examine the evolution of the banking system of late Qing China.Practical significance: the main conclusions of the article can be used in scientific and pedagogical activities in the study of economic history of traditional China, and may enrich the concepts of institutional economics concerning the limits and possibilities of institutional transformations.