SOAS Research Online

Abstract

The orthodox transition literature, that has dominated the debate on Eastern Europe, argues that well-defined property rights are a precondition for successful transition in post-socialist countries. As a result, most of this literature has treated the success of China's economic reforms as an enigma. The dilemma for "transition economists" is that the driving force behind China's high rate of economic growth has been the outstanding performance of its township and village enterprises (T.V.Es). Yet, in most cases, it is not clear who owns the T.V.E - the local residents or the township and village government. This thesis puts forward two main arguments. The first is that the success which T.V.Es have had can be explained through drawing on different notions of the division of labour. The second is that T.V.Es are a specific example of a broader literature on regionalism and that their success suggests some wider lessons. These form the basis of an alternative vision for post-socialist transformation based on collective learning. The thesis suggests that there is a legitimate cognitive function for less than arms-length relationships in post-socialist economies as part of a more general pattern of institutionalised diversification.