The Business of Lobbying in China / Edition 1

by Scott Kennedy

Overview

In this timely work, Scott Kennedy documents the rising influence of business, both Chinese and foreign, on national public policy in China.

China's shift to a market economy has made businesses more sensitive to their bottom line and has seen the passage of thousands of laws and regulations that directly affect firms' success. Companies have become involved in a tug of war with the government and with each other to gain national policy advantages, often setting the agenda, providing alternative options, and pressing for a favored outcome.

Kennedy's comparison of lobbying in the steel, consumer electronics, and software industries shows that although companies operate in a common political system, economic circumstances shape the nature and outcome of lobbying. Factors such as private or state ownership, size, industry concentration, and technological sophistication all affect industry activism.

Based on over 300 in-depth interviews with company executives, business association representatives, and government officials, this study identifies a wide range of national economic policies influenced by lobbying, including taxes, technical standards, and intellectual property rights. These findings have significant implications for how we think about Chinese politics and economics, as well as government-business relations in general.

Product Details

ISBN-13:	9780674027442
Publisher:	Harvard University Press
Publication date:	03/31/2008
Edition description:	New Edition
Pages:	278
Product dimensions:	6.12(w) x 9.25(h) x 0.75(d)

About the Author

Scott Kennedy is Deputy Director of the Freeman Chair in China Studies and Director of the Project on Chinese Business and Political Economy at the Center for Strategic and International Studies.

Table of Contents

Acknowledgments

List of Tables and Figures

Abbreviations

1. Introduction: The Puzzle of Lobbying in China

The Puzzle and the Project

Alternative Patterns of Government-Business Relations

Previous Research: Fulfilling Expectations

(Not) Explaining Variation

The Consequences

The Significance of Economic Factors

China as a Critical Case

The Research Design

Outline of the Book

2. Organizing Business in China

Introduction

The New Basis for Government-Business Interaction

Mapping China's Association System

The Limited Autonomy of Business Associations

The Missing Structural Components of Corporatism

Pluralism: A Mixed Picture

Beyond Clientelism

Conclusion: Explaining Variation

3. The Steel Industry: Walking on One Leg

Introduction

The Economics of Steel

The Weakness of China's Steel Associations

The Dominance of Direct Interaction

The Gap Between Connections and Clientelism

Cartel Calamities

Steel Trade Warriors

The Exception: Environmental Protection Policy

Conclusion

4. Consumer Electronics: Sending Mixed Signals

Introduction

The Economics of TVs and VCD Players

The Uneven Growth of Consumer Electronics Associations

Direct Contact: Taking Offense

The Price of Competition

Fighting Off the Tax Man

The Standard of Influence

Conclusion

5. Software: Approaching Pluralism

Introduction

The Economics of Software

The Growth of Software Associations

Other Signs of Pluralism

The "Normalization" of Relationships

The VAT: Revaluing the Industry

Copyright Protection: Joining the Fight

Standards: Erecting and Dismantling Barriers to Entry

Conclusion

6. Conclusion: China's Political Economies

Introduction

Linking Economics, Interaction, and Influence

Chinese Politics: Adapting Models and Integrating Sub-Fields

Incremental Democratization?

Reform Alternatives: Beyond Liberalization

Appendix: Case Selection and Interviews

Notes

Index

What People are Saying About This

Business-related lobbying, both domestic and foreign, is an important part of the political, legislative, and administrative process in China, and Scott Kennedy's fresh analysis is the best guide I have seen on the subject.

Ian Johnson

Scott Kennedy has dissected a complex subject in a lucid work with broad implications. His research, well-illustrated with fascinating examples of behind-the-scenes business lobbying, shows that the old corporatist model for explaining business-government relations is increasingly inadequate as interest groups and organizations compete for the government's ear. He shows us a richly complex country with increasing demands percolating up from below--a country that no longer fits the authoritarian model of popular imagination. Strongly recommended for anyone doing business in China or
interested in questions of civil society and, ultimately, political reform. --(Ian Johnson, author of Wild Grass: Three Stories of Change in China)

Jerome A. Cohen

Business-related lobbying, both domestic and foreign, is an important part of the political, legislative, and administrative process in China, and Scott Kennedy's fresh analysis is the best guide I have seen on the subject.
— Jerome A. Cohen, New York University School of Law

Harry Harding

Can Chinese firms promote their interests within what remains an authoritarian political system? Scott Kennedy argues that they can, in some cases through business associations. Based on extensive field research, this is one of the first books to examine the ways in which non-state actors in China pursue their interests through lobbying. It is an invaluable addition to the literature on state-society relations in contemporary China. --(Harry Harding, Elliott School of International Affairs, The George Washington University)

Margaret M. Pearson

Scott Kennedy, one of today's best young scholars of China's political economy, has written a fascinating book that changes the way we see the world of Chinese business. Contrary to the image of Chinese firms as unable or unwilling to influence policy at the national level, business lobbying of government is alive and well. Clearly written and full of vivid data on multiple industries and issues, this book is a must for anyone interested in business-government relations in China.
— Margaret M. Pearson, author of China's New Business Elite

Editorial Reviews

Chinese economic reforms and their impacts on democratization have elicited much speculation. This valuable case study of business-government relations provides insight into that debate.

Choice - C. A. Haulman

Through a series of well-documented case studies, Kennedy presents an intelligent and accessible analysis of "the business of lobbying in China." He does a superb job of focusing on industries that are national in scope and that command the attention of senior policymakers in China. For business leaders, academics, and graduate students alike, The Business of Lobbying in China illuminates the nuances associated with the complex political and business cultures in China.

China Business Review - Mark T. Fung

Scott Kennedy has produced a well-documented book on an important subject in the China field. He demonstrates an ability to link his area studies expertise with methodological and theoretical reflections drawn from comparative politics and comparative political economy. The book is highly recommendable to all serious students of Chinese affairs.

Pacific Affairs - Kjeld Erik Brødsgaard

Business-related lobbying, both domestic and foreign, is an important part of the political, legislative, and administrative process in China, and Scott Kennedy's fresh analysis is the best guide I have seen on the subject.

Jerome A. Cohen

Despite the recent proliferation of business firms in China and their evident economic power, surprisingly little is known about business involvement in national-level politics and policymaking. In this well-written book, Scott Kennedy sheds new light on this, examining the nature of business—government interactions at the national level in three economic sectors (steel, consumer electronics and software)...The book is carefully researched and well presented. It contains a wealth of new information gathered through extensive fieldwork and offers a series of original and well-supported arguments. In short, anyone interested in state-society relations, policy-making and economic activity in China will find the book valuable and thought-provoking.

China Journal - Kenneth W. Foster

Can Chinese firms promote their interests within what remains an authoritarian political system? Scott Kennedy argues that they can, in some cases through business associations. Based on extensive field research, this is one of the first books to examine the ways in which non-state actors in China pursue their interests through lobbying. It is an invaluable addition to the literature on state-society relations in contemporary China.

Harry Harding

In this fascinating monograph, Scott Kennedy explores the nature of state-society relations through the lens of business lobbying. He begins his work by criticizing existing approaches in comparative politics, which often try to fit various countries into a few standard models of state-society relations: pluralism, corporatism, clientelism, and monism. Given the complexity and dynamism in China’s economy, Kennedy makes the astute observation that no single model suffices to describe the complex business-government relations in China.

Victor Shih

Tucked away in this well-researched, carefully reasoned piece of scholarship are fresh, insightful observations on both economic and political trends in Chinese society...Scott Kennedy's book is a thoughtful examination of the ways and the extent to which business in China influences government policy.

Far Eastern Economic Review - Sidney Rittenberg

Scott Kennedy, one of today's best young scholars of China's political economy, has written a fascinating book that changes the way we see the world of Chinese business. Contrary to the image of Chinese firms as unable or unwilling to influence policy at the national level, business lobbying of government is alive and well. Clearly written and full of vivid data on multiple industries and issues, this book is a must for anyone interested in business-government relations in China.

Margaret M. Pearson

Scott Kennedy has dissected a complex subject in a lucid work with broad implications. His research, well-illustrated with fascinating examples of behind-the-scenes business lobbying, shows that the old corporatist model for explaining business-government relations is increasingly inadequate as interest groups and organizations compete for the government's ear. He shows us a richly complex country with increasing demands percolating up from below—a country that no longer fits the authoritarian model of popular imagination. Strongly recommended for anyone doing business in China or interested in questions of civil society and, ultimately, political reform.

Ian Johnson

Scott Kennedy has produced a well-documented book on an important subject in the China field. He demonstrates an ability to link his area studies expertise with methodological and theoretical reflections drawn from comparative politics and comparative political economy. The book is highly recommendable to all serious students of Chinese affairs.

Pacific Affairs - Kjeld Erik Brødsgaard

In this fascinating monograph, Scott Kennedy explores the nature of state-society relations through the lens of business lobbying. He begins his work by criticizing existing approaches in comparative politics, which often try to fit various countries into a few standard models of state-society relations: pluralism, corporatism, clientelism, and monism. Given the complexity and dynamism in China’s economy, Kennedy makes the astute observation that no single model suffices to describe the complex business-government relations in China.

Perspectives on Politics - Victor Shih

Scott Kennedy has produced a well-documented book on an important subject in the China field. He demonstrates an ability to link his area studies expertise with methodological and theoretical reflections drawn from comparative politics and comparative political economy. The book is highly recommendable to all serious students of Chinese affairs.

— Kjeld Erik Brødsgaard

Pacific Affairs

In this fascinating monograph, Scott Kennedy explores the nature of state-society relations through the lens of business lobbying. He begins his work by criticizing existing approaches in comparative politics, which often try to fit various countries into a few standard models of state-society relations: pluralism, corporatism, clientelism, and monism. Given the complexity and dynamism in China’s economy, Kennedy makes the astute observation that no single model suffices to describe the complex business-government relations in China.
— Victor Shih

Perspectives on Politics

Through a series of well-documented case studies, Kennedy presents an intelligent and accessible analysis of "the business of lobbying in China." He does a superb job of focusing on industries that are national in scope and that command the attention of senior policymakers in China. For business leaders, academics, and graduate students alike, The Business of Lobbying in China illuminates the nuances associated with the complex political and business cultures in China.
— Mark T. Fung

China Business Review

Despite the recent proliferation of business firms in China and their evident economic power, surprisingly little is known about business involvement in national-level politics and policymaking. In this well-written book, Scott Kennedy sheds new light on this, examining the nature of business—government interactions at the national level in three economic sectors (steel, consumer electronics and software)...The book is carefully researched and well presented. It contains a wealth of new information gathered through extensive fieldwork and offers a series of original and well-supported arguments. In short, anyone interested in state-society relations, policy-making and economic activity in China will find the book valuable and thought-provoking.
— Kenneth W. Foster

China Journal

Tucked away in this well-researched, carefully reasoned piece of scholarship are fresh, insightful observations on both economic and political trends in Chinese society...Scott Kennedy's book is a thoughtful examination of the ways and the extent to which business in China influences government policy.
— Sidney Rittenberg, Sr.

Far Eastern Economic Review

Chinese economic reforms and their impacts on democratization have elicited much speculation. This valuable case study of business-government relations provides insight into that debate.
— C. A. Haulman

Choice