Back-alley Banking: Private Entrepreneurs in China

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Cornell University Press, Mar 1, 2004 - Business & Economics - 316 pages
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Chinese entrepreneurs have founded more than thirty million private businesses since Beijing instituted economic reforms in the late 1970s. Most of these private ventures, however, have been denied access to official sources of credit. State banks continue to serve state-owned enterprises, yet most private financing remains illegal. How have Chinese entrepreneurs managed to fund their operations? In defiance of the national banking laws, small business owners have created a dizzying variety of informal financing mechanisms, including rotating credit associations and private banks disguised as other types of organizations. Back-Alley Banking includes lively biographical sketches of individual entrepreneurs; telling quotations from official documents, policy statements, and newspaper accounts; and interviews with a wide variety of women and men who give vivid narratives of their daily struggles, accomplishments, and hopes for future prosperity. Kellee S. Tsai's book draws upon her unparalleled fieldwork in China's world of shadow finance to challenge conventional ideas about the political economy of development. Business owners in China, she shows, have mobilized local social and political resources in innovative ways despite the absence of state-directed credit or a well-defined system of private property rights. Entrepreneurs and local officials have been able to draw on the uncertainty of formal political and economic institutions to enhance local prosperity.
 

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Contents

The Power of Informal Institutions
1
The Political Economy of Informal Finance in China
24
Gendered Worlds of Finance in Fujian
60
Financial Innovation and Regulation in Wenzhou
120
Creative Capitalists in Henan
166
Curb Markets in Comparative Context
215
The Local Logics of Economic Possibility
246
Research Methodology
267
List of NonSurvey Field Interviews 19942001
279
List of Surveys 199697
286
Coding for Business Types
290
Comparative Summary of Rotating Savings and Credit Associations
291
Sources Cited in Table 61 and Appendix E
296
Glossary of Chinese Terms
300
Index
307
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Democracy
Charles Tilly
Limited preview - 2007
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About the author (2004)

Kellee S. Tsai is Professor of Political Science and Vice Dean for Humanities, Social Sciences, and Graduate Programs at The Johns Hopkins University.

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