Capitalism with Chinese Characteristics: Entrepreneurship and the State

by Yasheng Huang

most substantial reversal occurred in the area of rural finance. Private-sector access to capital to engage in nonfarm activities became very difficult in the 1990s. The embryonic rural financial liberalization – decentralization of management of local savings and loans organizations and a permissive stance toward private entry into the financial services sector – was completely stopped. Rural political and fiscal management was centralized. In more recent years, lease holdings of land have become increasingly insecure as local officials have grabbed land on a massive scale. Directional liberalism turned into directional illiberalism. Not a single new political reform initiative was proposed in the 1990s and many of the political reform initiatives of the 1980s were discontinued (Pei 2006, p. 11).