Damian Tobin & Laixiang Sun :
036_DP53 Capitalist Entrepreneurs or Bureaucrats left to their own Devises? The Role of Bureaucratic Entrepreneurs and the Rapid Growth of China’s Telecom Sector
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Abstract:
This paper describes how China, instead of adopting the standard approach of transferring large public monopolies to the private sector, opted to change gradually the institutional rules and incentives for bureaucrats. This has allowed bureaucrats with long traditions in central planning, to overcome institutional rigidities and behave in a manner not unlike entrepreneurial capitalists. The rapid development of China’s telecom sector is used to illustrate how significant growth can be achieved by realising the entrepreneurial spirit of bureaucrats, even in the absence of full privatisation, liberalisation and transparent regulation. It suggests that the immediate constraint to bureaucratic entrepreneurs is a limited familiarity with the market mechanism and competition.
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