Toward a Reputation State: The Social Credit System Project of China

63 Pages Posted: 24 Jun 2018

See all articles by Xin Dai

Xin Dai

Ocean University of China

Date Written: June 10, 2018

Abstract

The ongoing “reputation revolution,” as it refers to the widespread adoption of reputation tracking and analytics, is now seeing its frontier shifting from the “reputation society” to the “reputation state”: Government authorities, following the steps of private sector players, now increasingly seek to use reputation mechanisms and technologies in the spheres of law and governance. In 2014, China’s national government unveiled a massive policy plan for building a “social credit system” in China (hereinafter the “SCSP,” which stands for the “social credit system project”). In designing the SCSP, the Chinese government envisioned that reputation mechanisms such as blacklisting, rating, and scoring be used to tackle many of the country’s by far intractable governance and regulatory problems in its social and economic realms, ranging from fraudulent behaviors in the marketplace, to difficulties in enforcing court judgments, to corruption in the government, and to professional malpractices and even plagiarism in scholarship. Although Western governments have also explored using reputation technologies and mechanisms in governance and social control contexts, China’s SCSP, as a comprehensive, singularly framed, and actively implemented policy project, knows no equivalent elsewhere in the world, and thus offers a unique case for studying a rise of the reputation state as a broader trend.

This Article provides a systematic descriptive and analytical study on the SCSP. It draws on the general theoretical discussions on the reputation state to identify four key strategies, categorized in this Article as “regulation,” “searchlight,” “incorporation,” and “institutionalization,” which government actors may plausibly employ as they seek to use reputation for law and public administration. While Western experiences already illustrate ways in which these strategies may actually work in practical contexts, China’s SCSP takes the reputation state into the uncharted territory as it explores novel possibilities. Upon examining the major policy initiatives included, this Article finds that the SCSP overall represents the effort of China’s developmental state to tackle its persistent governance problems with new tools. While it has both raised high hopes and stoke grave fears, the SCSP, as this Article explains, has been fundamentally shaped and also limited by many of the institutional and market forces that animate it in the first place. Nonetheless, if future institutional arrangements and technological progress could align to overcome the present implementation challenges, the reputation state effected through the SCSP does have the potential to change law and government as we know them in China and beyond. Specifically, this Article offers initial thoughts on the SCSP’s plausible implications in three areas that are important but inadequately explored, relating in broad terms to government expansion and efficiency, optimal approach to enforcement, and intragovernmental agency control.

Keywords: Reputation, Social Credit System, China

JEL Classification: K20, K40

Suggested Citation

Dai, Xin, Toward a Reputation State: The Social Credit System Project of China (June 10, 2018). Available at SSRN: https://ssrn.com/abstract=3193577 or http://dx.doi.org/10.2139/ssrn.3193577

Xin Dai (Contact Author)

Ocean University of China ( email )

5 Yushan Road
Qingdao, 266003
China

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