A Model of Chinese Central Government: The Role of Reciprocal Accountability

35 Pages Posted: 10 Jul 2013

See all articles by Mario Gilli

Mario Gilli

Università degli Studi di Milano-Bicocca - Center for Interdisciplinary Studies in Economics, Psychology & Social Sciences (CISEPS); Università degli Studi di Milano-Bicocca - Department of Economics, Management and Statistics (DEMS)

Yuan Li

Catholic University of the Sacred Heart of Milan

Date Written: June 2012

Abstract

Why was the same state in China able to promote economic growth in the reform era but not in the previous thirty years? In this paper we focus on a specific aspect that might help the search for a comprehensive explanation: the specific institutional arrangement that induced autocratic government to adopt growth-enhancing policies. To this aim, we consider a standard political agency model (Besley, 2006) where the incumbent leader may be either congruent or not, and where both types need the support of the ‘selectorate’ to hold on to power. Our main result is that in autocracies without electoral discipline, to restrain the opportunistic behavior of a leader, the size of the ‘selectorate ’should be intermediate: if too small, the ‘selectorate ’is captured by the leader and has no disciplinary role; if too big, the leader’s incentives are diluted.

Keywords: accountability, selectorate, political agency, Chinese economic reform

JEL Classification: D02, H11, D74

Suggested Citation

Gilli, Mario and Li, Yuan, A Model of Chinese Central Government: The Role of Reciprocal Accountability (June 2012). University of Milan Bicocca Department of Economics, Management and Statistics Working Paper No. 230, Available at SSRN: https://ssrn.com/abstract=2291254 or http://dx.doi.org/10.2139/ssrn.2291254

Mario Gilli (Contact Author)

Università degli Studi di Milano-Bicocca - Center for Interdisciplinary Studies in Economics, Psychology & Social Sciences (CISEPS) ( email )

Piazza dell'Ateneo Nuovo, 1
Milano, 20126
Italy

Università degli Studi di Milano-Bicocca - Department of Economics, Management and Statistics (DEMS) ( email )

Piazza dell'Ateneo Nuovo, 1
Milan, 20126
Italy

Yuan Li

Catholic University of the Sacred Heart of Milan ( email )

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