Working Papers

 "Institutions and the struggle of private ownership: the case of China"

The objective of this research is to delve into the intricate economic history of China, spanning from the late Qing dynasty to 1956, with a particular focus on the comparison between the performance of state-related and private enterprises. The study aims to shed light on the challenges faced by private enterprises and also seeks to highlight the contrasting success of them. While the research highlights the persistent government support for state-related enterprises during these times of institutional uncertainty, it also underscores a counterintuitive trend. It becomes apparent that excessive government intervention in the business environment may inadvertently hinder the success of state-owned or state-related companies. This observation raises pertinent questions about the nature of state involvement in the business sector. Intriguingly, the research identifies a paradoxical outcome: the era of unsuccessful state interventions in state-related enterprises was often followed by a relatively flourishing development of private-owned companies. Private businesses, despite receiving limited support, exhibited resilience and adaptability, ultimately thriving amidst the shifting economic landscape. This study, therefore, suggests that the development of private businesses in modern China was not necessarily rooted in government support but rather in the pursuit of free enterprise within a supportive environment. It calls attention to the potential pitfalls of excessive state involvement in economic affairs and suggests that the success of businesses is intricately linked to a balance between government guidance and entrepreneurial autonomy. In summary, this research endeavors to provide a comprehensive understanding of the economic history of China from the late Qing Dynasty to 1956 by examining the relationship between government support, the performance of state-related enterprises, and the resilience of private businesses. By unraveling the complex interplay of factors at play in these historical periods, this study aims to contribute valuable insights to our understanding of economic development in China and the role of government intervention in shaping the business landscape.

 "The decentralization path of China’s reform and opening up"

The purpose of this research is to delve into the multifaceted history of China's reform and opening up, with a particular emphasis on the various government policies that were implemented to support and foster the development of private ownership. This transformative period in China's history saw the flourishing of private businesses and the establishment of a more open and supportive environment for them. The notable prosperity of private ownership since the initiation of the reform and opening up, as well as the presence of a market economy in China, underscore a significant shift in government policies toward decentralization. The decentralization path chosen by the Chinese government can be observed from several angles. In the institutional realm, the central government began to delegate more authority and decision-making power to local governments. This shift allowed local authorities to have greater autonomy in shaping economic policies and regulations, aligning them more closely with the specific needs and circumstances of their regions. In the economic sphere, the government provided enterprises with greater independence and autonomy. By reducing bureaucratic hurdles and allowing companies to make decisions based on their own strategies and market dynamics, the government promoted a more competitive and dynamic business environment. The decentralized approach allowed local economies to respond more flexibly to the challenges and opportunities presented by the globalized world. It enabled regions to leverage their comparative advantages, invest in sectors most suited to their strengths, and foster innovation, thus driving China's economy onto a high-growth trajectory. This research, therefore, aims to shed light on the pivotal role of decentralization in the success of private ownership and the broader reform and opening up policies in China. It underlines how empowering local governments and enterprises with greater independence and autonomy led to a more dynamic and prosperous economic landscape. By examining the historical trajectory of decentralization in China's economic policies and its impact on private ownership, this study seeks to provide valuable insights into the interplay between government policies and entrepreneurial success, as well as the larger dynamics of economic development in China.

 "Filling in the gap: institutional change and the development of Huawei"

The aim of this research is to explore the intriguing dynamic of how private firms developed during a period in China's history when institutional frameworks were neither sufficient nor highly effective. This critical juncture aligns with the early phase of China's reform and opening up policies. During this period, the Chinese government made a significant decision to restore private ownership and actively support its development. This study focuses on Huawei, a prominent and globally recognized company, as a case study to delve into the history of private business development in China during this era of institutional uncertainty. The backdrop against which this research unfolds is characterized by the absence of well-established and robust institutional structures. In this environment of uncertainty, private companies like Huawei faced numerous challenges that required them to be self-reliant and inventive in their strategies for survival and growth. Unlike the more predictable landscape of planned coordination and state investment, these companies had to navigate a complex and often unpredictable business environment. Huawei, in particular, provides an illustrative case study. It offers a unique perspective on how a private firm, when confronted with institutional gaps, can carve out its own path to success. The company's journey from its early days to becoming one of the world's largest telecommunications firms exemplifies the need for adaptability, improvisation, and strategic thinking in the absence of well-defined institutional structures. It embarked on a journey to "fill in the blanks" in the Chinese telecommunications market, creating innovative solutions where institutional support was lacking. The company demonstrated an exceptional ability to improvise and construct its own institutional structures to accommodate its growth and expansion. This research aims to provide a comprehensive examination of Huawei's history and the various strategies it employed to thrive within a context of institutional uncertainty. By investigating Huawei's experiences and successes, this study seeks to uncover valuable insights into how private firms can adapt and prosper when conventional institutional support is limited. In doing so, it sheds light on the relationship between private entrepreneurship and institutional development, offering a unique perspective on the evolution of private business in China during a period of profound transformation.

 "Adaptive Strategy and State Influence: Matsushita’s Path in Japan’s Evolving Policy Environment"

In this research, I delve into the evolution of Matsushita Electric Industrial Co. (now Panasonic) during Japan's rapid industrialization in the 20th century. I examine how Matsushita not only adapted to but actively engaged with institutional uncertainties, leveraging them as strategic opportunities to drive innovation and growth. By navigating a shifting policy landscape, Matsushita influenced state policies and contributed to the creation of a supportive environment for the entire electronics industry in Japan. The research explores Matsushita's innovative marketing strategies, commitment to technological advancement, and unique organizational structures—such as its pioneering adoption of the divisional system. These strategies allowed the company to respond effectively to domestic and international challenges, including economic crises and increasing global competition.Through this case study, I highlight the dynamic interplay between corporate strategy and state policy. Matsushita's ability to influence industrial policies demonstrates how firms can use institutional ambiguity not just to survive but to shape their operating environment proactively. This analysis provides valuable insights into the mechanisms by which private enterprises can foster industry-wide development and enhance national competitiveness, offering lessons that are relevant to contemporary contexts of economic growth and policy-making.