China's Party-State Capitalism and International Backlash: From Interdependence to Insecurity
Open accessAbstract
Contrary to expectations, economic interdependence has not tempered security conflict between China and the United States. In response to perceived domestic and external threats, the Chinese Communist Party's actions to ensure regime security have generated insecurity in other states, causing them to adopt measures to constrain Chinese firms. Security dilemma dynamics best explain the subsequent reactions from many advanced industrialized countries to the evolution of China's political economy into party-state capitalism. Party-state capitalism manifests in two signature ways: (1) expansion of party-state authority in firms through changes in corporate governance and state-led financial instruments; and (2) enforcement of political fealty among various economic actors. Together, these trends have blurred the distinction between state and private capital in China and resulted in backlash, including intensified investment reviews, campaigns to exclude Chinese firms from strategic sectors, and the creation of novel domestic and international institutions to address perceived threats from Chinese actors. The uniqueness of China's model has prompted significant reorganization of the rules governing capitalism, both nationally and globally.
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In comparison to China's earlier industrial policy, the Made in China 2025 plan affords the party-state broader scope in allocating resources through grants, tax breaks, loans, and direct investments from an expanding array of investment vehicles that increasingly blur the lines between state and private control.
“In comparison to China's earlier industrial policy, the plan affords the partystate broader scope in allocating resources (McBride and Chatzky 2019) through grants, tax breaks, loans, and direct investments from an expanding array of investment vehicles that increasingly blur the lines between state and private control (e.g.state-managed private equity fund) (Pearson, Rithmire, and Tsai 2022).”
From The Second Cold War: US-China Competition for Centrality in Infrastructure, Digital, Production, and Finance Networks (2024) · cites this paper as Pearson, Rithmire, and Tsai 2022
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Cites
The China Shock: Learning from Labor-Market Adjustment to Large Changes in Trade
Autor, D. H., Dorn, D., & Hanson, G. H. (2016) · Annual Review of Economics · doi:10.1146/annurev-economics-080315-015041 · Cited by 1,305 · see citing works
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Research works printed but not linked: 9
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Schindler, S., Alami, I., DiCarlo, J., Jepson, N., Rolf, S., Bayırbağ, M. K., Cyuzuzo, L., DeBoom, M., Farahani, A. F., Liu, I. T., et al. (2024) · Geopolitics · doi:10.1080/14650045.2023.2253432 · Cited by 252 · see citing works
“…in allocating resources (McBride and Chatzky 2019) through grants, tax breaks, loans, and direct investments from an expanding array of investment vehicles that increasingly blur the lines between state and private control (e.g. state-managed private equity fund) (Pearson, Rithmire, and Tsai 2022).”
Background
- Authors
- Pearson, M. M., Rithmire, M., & Tsai, K. S.
- Affiliations
- University of Wisconsin–Madison (US)
- Venue
- International Security
- Publisher
- MIT Press
- Published
- 2022
- Volume
- 47
- Issue
- 2
- Pages
- 135-176
- ISSN
- 0162-2889 (ISSN-L)
- 1531-4804
- OpenAlex
- W4313008754
- Cited by
- 125
- References
- 1
- Citations by year
- 2026: 22 · 2025: 39 · 2024: 51 · 2023: 11 · 2022: 2
- FWCI
- 84.08
- Type
- journal article
- Language
- en
- Open access
- hybrid
- doi.org
- Licence
- public-domain
- Locations
- International Security (publishedVersion, public-domain)
- Project Muse (Johns Hopkins University) (submittedVersion)
- Rare & Special e-Zone (The Hong Kong University of Science and Technology) (submittedVersion)
- Topics
- Social Sciences › Political Science and International Relations › COVID-19, Geopolitics, Technology, Migration
- Social Sciences › Political Science and International Relations › China's Socioeconomic Reforms and Governance
- Social Sciences › Political Science and International Relations › International Relations and Foreign Policy
- Keywords
- Chinese Communist Party, security dilemma, economic interdependence, regime security, corporate governance, investment review, strategic industries, Chinese political economy, international institutions
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