Market Reform and Collective Action in China

Abstract

Although it is universally agreed that socialist political economy fails to satisfy the demand for private goods, it is often assumed that socialist states are superior providers of public goods by virtue of the public ownership of property and appeals to altruistic impulses. This article reviews social choice and game theoretic approaches to collective action, and concludes to the contrary that in China such institutions have been counterproductive. By contrast, it is argued that the self-interested, market-oriented reforms introduced since the death of Mao can actually enhance collective action, provided that the regime assures social stability and the enforcement of property rights.