State Capacity and Economic Performance in China, a match made in heaven

Abstract

Does state capacity influence economic performance in China? In this research exercise, I will attempt a casual examination of the role of state capacity in China’s miraculous economic performance. I will specifically examine the Chinese state’s ability to collect taxes. I argue that the Chinese state’s capacity to collect taxes efficiently is a miracle of modern statecraft. It illustrates to us that a strong state capacity in China bequeaths modern economic miracles. Improvements in tax capacity in China have been a part of a deeper process of state capacity building. Building tax capacity is linked to the process of economic development and growth in China. This research exercise explores the political conditions that have supported broader changes in state and tax capacity – and how these changes yield a culture of economic growth.

View paper