Edited by Francisco Cabrillo and Miguel A. Puchades-Navarro
Chapter 5: Reforms and decentralization: friends or foes?
Systemic concerns about markets, capitalism and the role of the state in the economy are salient again. Relatively large-scale reforms of economic and/or social arrangements are seriously considered and some (in the financial sector in particular) are undertaken or may be imminent. Historical experience suggests that reforms of that kind are sometimes associated with changes in the ‘architecture of government’ – to borrow the title of a recent book on political decentralization (Treisman 2007). Inspired in part by historical experience, discussions about economic systems or about ‘national models’ of economic governance now often give a role to the relationship between national and sub-national governments. A case in point is the political economy literature on China. In that literature, an influential view is that the economic performance of China is related to the way it has organized the relations between central and regional and local authorities, both in its official institutions and within its ruling party.
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