Central Mandates in Flux: Local Noncompliance in China

Abstract:     
This article examines a particular type of central mandate in China, the mandate for nationwide across-the-board salary increases in the public sector. The making and implementation of this mandate epitomizes the changes and challenges in intergovernmental relations of a transition economy. Our findings show that although the central pay mandates were issued under a number of conditions that favored, or should have even guaranteed, their smooth implementation, local reactions to the mandates have deviated from central expectations.The mandated pay raises have not only failed to win local compliance but also given rise to widespread pay arrears. Based on empirical data from two Chinese counties, this article analyzes the causes of local noncompliance and its implications for intergovernmental management.

Number of Pages in PDF File: 21

Keywords: intergovernmental management, fiscal decentralization, central mandate, civil service pay, China

JEL Classification: H77, H11

working papers series